// Retailers call on government to extend the trade credit reinsurance scheme
// The scheme was launched in May last year in response to the pandemic
// It was extended in December but the government confirmed that it would end on June 30
Retailers across the UK are calling on the government to extend the trade credit reinsurance scheme, which guarantees insurance amid speculations that businesses may be unsupported when it ends.
The scheme was introduced by the government in May last year in response to the Covid-19 pandemic, offering guarantees to insurers who cover suppliers against the risk of non-payment by their customers.
It was extended in December but the government confirmed that it would end on June 30, alongside the commercial rent moratorium.
The BRC has written to business minister Paul Scully and said that if insurers base risk assessments on retailers’ recent financial performance, many will be left unprotected.
The BRC also said that insurers need at least six months’ worth of consistently strong trading data to reassess coverage decisions, adding that even where such data existed, insurance companies have been slow to revisit underwriting decisions.
Moreover, there are also concerns that lenders may be hesitant to extend uninsured credit to retailers after over a year of struggling with lockdown restrictions.