The impact of COVID-19 on finances

impact of covid on finances

The entire world is currently experiencing the outbreak of Covid-19. In the United Kingdom, we’re currently in a state of lockdown, where the government have asked for people to stay at home to reduce the spread. From the initial stages of panic buying, through to offices suddenly emptying and businesses closing their doors, for some it will be a case of closing those doors for good.

Just as some people are handling these changes better than others, there is a difference in how businesses are being affected, as well. Numerous industries have come under pressure, and many have had to face either mass redundancies or folding and going into bankruptcy. As a result, on the 25th of March, a call centre worker at Universal Credit stated that on that day alone, 100,000 calls had been answered, and an estimated 100,000 had been unable to get through as a result in the change in demand. 

The government have issued help for many, giving many companies the ability to furlough employees, with the government covering 80% of their salary until further notice, but this doesn’t apply to everyone. For a while, the self-employed didn’t know where they stood either, with many continuing to put themselves at risk in order to earn a living. It is uncertain what support will be provided to those already unemployed, and now further struggling to find any work.

Where some companies are folding, as always, others are now very overstretched, supermarkets are hiring en-masse, the NHS has called back all recently retired staff to come out of retirement and teamed up with private healthcare facilities to extend its reach. Delivery drivers are more in demand than ever as people are encouraged to order their food in, rather than risk contamination at the supermarket. 

Some companies are adjusting to remote working exceptionally well, and have had little to no disruption. The digital industries such as ours, have seen little to no effect of Covid-19 on business, and rather have been needed on hand to support and assist clients in managing the news about the coronavirus and the impact on their customers.

Regardless of this, right now there are people all over the country that are uncertain about the future. Uncertain of just how long this will go on for and the effect that will have on livelihoods. Even the companies that are doing well right now working remotely, may need to reconsider their strategy in the near future if this pandemic is set to last the rest of the year.

DID YOU KNOW?

Thanks to the FCA, you can apply for a payment holiday of three months for all of the following:

  • Mortgage payments
  • Loan Payments
  • Credit Card Payments

And many banks are now offering no extra charges on the first £500 of your overdraft. This is a dramatically different approach to the one we saw a few months ago, spiking all interest for arranged and unarranged overdraft to 39.9% AER.

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