For many years now Bank Guarantees have been the saviour for many companies facing cash flow problems and even bankruptcy. The ability to access loans and lines of credit using Bank Guarantees as security will play a major financing role as we enter 2021 and onwards into 2022. We feel this form of finance will enable our high streets to blossom and grow once again as outlined below.
It is patently obvious to anyone with half a brain that the heart has been ripped out of the United Kingdoms high streets. For those many retailers whose margins where extremely thin after paying local authority business rates, sales taxes and rents have now sadly closed forever. The pandemic was the final nail in the coffin as big business and the internet have been taking away business from the high street for years.
Both the government and local authorities have to admit we are now living in a new world. Local authorities are losing millions on business rates as shops, pubs and hotels shut. Even major retail outlets are going out of business. So instead of financing yesteryear in the hope that everything will go back to normal, the usually intransigent leaders will have to adapt to a brave new world and for once start looking forward. Local government must change their planning laws to encompass housing and retail in the high street otherwise it will remain dead for years to come.
Instead of local and national governments telling the public what they want, they need to listen to the public. There is an ever-increasing clamour for new housing, so the high streets need to be redeveloped to encompass housing, shops, bars, restaurants. But will local authorities embrace a new concept like this? The added bonus here is that there will a lot of employment on offer plus reducing the housing deficit. Too god to be true? Then at least look at Bank Guarantee funding.
How will this new evolution be financed? Not by the banks, who are busy trading for themselves and not investing in community projects where the returns are so much less than elsewhere. Not by local authorities whose blinkered outlook will just serve yesteryears mistakes.
In 2021 and onwards the main source of finance will come from Bank Guarantees. There are a raft of lenders who will be happy to lend against this bank instrument enabling developers to reignite the touch paper on our high streets providing a new wave of housing, bars, restaurants and shops in a community which because of location will not spend the whole time ordering on the internet.
Bank Guarantees are already providing a lifeline for many businesses throughout the United Kingdom, Europe the Middle East and Asia. Remember, Bank Guarantees are providing finance denied by banks and other traditional lenders. Now is the time to revitalise the high streets and Bank Guarantees are the way forward.
Companies short of the necessary investment funds to revitalise the high street can use a Bank Guarantee to raise capital and start to invest in the United Kingdom’s high street with the prospects after year 1 of converting the Bank Guarantee into a commercial loan. There are many other institutions apart from the traditional financiers who would jump at this opportunity.
Sadly, the above all depends on the local authorities and national government. Bank Guarantees can change the face of the high street, but it will need the willing participation of local governments who need to adapt to a post pandemic world.