The latest Department for Business quarterly Covid-19 loan performance figures showed that 5.53% of legitimate bounce back loans were in arrears, while 1.08% have defaulted. The government gave a 100% guarantee on these loans, leaving the taxpayer footing the bill for losses.

In the last quarter a total of £1.84bn of the total loan book has been flagged for suspected fraud, up from £1.65bn from the previous review.

However, it is estimated this could rise to almost £20bn, but it is not all negative, as the government claimed that up to 500,000 businesses and 2.9m jobs were saved through these loan schemes.

Lenders had flagged £1.1bn as suspected fraud by 31 December 2023, however, this was subject to change as internal processes were completed.

As well as the bounce back loan scheme, the Coronavirus Business Interruption Loan Scheme (CBILS) has flagged suspected fraudulent activity. There were just 151 of these loans given out, with £34.18m of this being potential frauds.

Over 94% of CBILS have been either fully repaid or on track to be paid within the six-year time limit, and less than 1% were in arrears.

COVID-19 loan guarantee schemes performance data as at 31 December 2023