UK Shifts COVID Loan Losses to Banks as Fraud and Errors Rise

UK government removed state guarantees from nearly £1bn in Covid business loans, shifting potential losses to banks if borrowers default

Guarantees removed for various reasons like duplicate funds sent, application errors, and rule violations

Loan schemes intended to support economy during lockdowns, with government covering some bank losses

But concerns over widespread fraud and errors in the rushed lending, estimated at £77bn total

Government increased estimated fraud to £1.7bn in September, with bounce back loan scheme particularly scrutinized