Gary Crosbie wants to keep his staff on, but like other small firms, his profitable business now faces running out of cash owing to the coronavirus shutdown.
Mr Crosbie runs Inter-Refurb, which refurbishes pubs, hotels and restaurants.
He says he can demonstrate three years of profits, with £50,000 cash in the bank.
Yet because his bank decided it didn’t wish to support the construction industry, he failed the test that required banks only to lend according to their pre-shutdown criteria. He was rejected for a government-backed loan last week.
“My accountant said, ‘You can put off paying your VAT.’ But that’s up to date. They said, ‘Well, you can put off paying national insurance’ – but I’d kept that up to date too. So for doing the right thing – I can’t get any help,” he told the BBC.
The government must bring in urgent reforms to its coronavirus loan scheme to stop small businesses going bust.
That’s the message from MPs and firms who say loans are still being approved too slowly to help firms hit by lockdown measures.
The British Chambers of Commerce said that only 2% of UK’s firms had so far secured the loans.
The Treasury said it was taking “unprecedented action to support business”.
It said that action included £330bn in business loans and guarantees, paying 80% of furloughed workers’ wages and giving £3bn cash grants to a quarter of million small businesses, as well as tax deferrals.
Chancellor Rishi Sunak has also previously ruled out the taxpayer giving 100% backing for the loan scheme.
“When people say I should take 100% of the risk, it’s not really me, it’s actually all of us, it’s the taxpayer taking 100% of the risk of the loans defaulting,” he said.
So far, banks and financial institutions have lent more than £1.1bn to small and medium-sized enterprises, according to figures released by UK Finance on Wednesday.
More than 6,000 loans have now been provided, with an average value of about £185,000.
Ministers brought in the Coronavirus Business Interruption Loan Scheme with promises that they would do whatever it took to support firms hit by the shutdown.
Government-backed loans were to be available to all firms that were solvent and trading when the shutdown began.
The Treasury revamped the loans scheme two weeks ago, while banks said they worked through the Easter weekend to boost lending.
But some business owners have told the BBC that they have not been able to access loans or grants.