19 Mar 2020 | 04.55 pm
Coronacrisis: Linked Finance Shows Up Pillar Banks
Green Party slams row-back by EBS on mortgage breaks
19 Mar 2020 | 04.55 pm
Linked Finance has thrown down a challenge to the banks by implementing a blanket two-month payment break to all its loans to the restaurant, bar, pub and hotel trades.
“The break will be applied automatically, hassle free and with no forms required,” according to the peer-to-peer lending platform.
Now it has come up with more supports, such as repayment breaks of up to three months for the most affected borrowers, and an offer to new borrowers of no payments for three months on its new loan facility which will launch shortly.
Chief executive Niall Dorrian (pictured) said: “We have been actively engaging with our borrowers who have been hard hit by the need to close stores, reduce opening hours or who are experiencing disrupted supply chains. Many have seen their takings dry up overnight.
“Irish SMEs are the lifeblood of the Irish economy and we want to support them through this unprecedented crisis. We have been overwhelmed with the support we are getting from our base of lenders for the proactive measures. They are ordinary individuals and often business owners themselves; they really understand what our borrowers are going through.
“We believe this will allow these businesses to evaluate the impact and plan for recovery once the COVID-19 situation eases.”
Dorrian added that the platform is actively engaging with government on how the P2P lending sector, and other alternative finance providers, can help SMEs access financial support.
“The sector can deploy capital quickly and simply and the importance and value of this should be recognised and form part of the solution,” said Dorrian.
No Respite Offered By EBS
At the same time, the Green Party has hit out at banks, which it says are already rowing back on the commitments they made to finance minister Paschal Donohue on a range of relief measures, including mortgage payment breaks.
Spokesperson Neasa Hourigan said: “It appears customers are being told by their branches that AIB-owned EBS is not in fact offering its customers a payment break, but rather the ‘option’ to move to three months of interest-only mortgage repayments.
“This is materially different from the minister’s announcement and will be a struggle for some homeowners who have been laid off as a result of Covid-19. The Minister for Finance needs to use his influence to ensure that the majority state-owned banks live up to the intent of the announcement.
“The Green Party is also hearing reports of what it considers undue red tape to avail of this offer. Again the minister needs to make it clear that the application process needs to be as simple as possible. “The banks, who were supported by the Irish tax payer in their own difficult times, need to recognise that this is not a period for a ‘business as usual’ attitude.”