In a bid to help steer its membership through the coronavirus upheaval, the National Association of Commercial Finance Brokers (NACFB) has told its members that they will not be levied membership fees for four months.
The overwhelming majority of the NACFB’s 1,930 members are self-employed, many working as sole traders who submit a tax return via self-assessment.
The NACFB said: “To provide an immediate and direct lifeline for brokers, the Association will not be running direct debits for membership fees, nor will it seek to latterly accrue payment.”
The decision came after Rishi Sunak, the Chancellor of the Exchequer, unveiled his support scheme for the UK’s estimated five million self-employed on 26 March.
Addressing the self-employed, the Chancellor said: “We will not leave you behind and we are all in this together.”
In a historic announcement, Sunak said the self-employed could apply for a grant covering 80% of their income for three months, capped at £2,500 a month.
Individuals will not need to prove their business was hit by the coronavirus to benefit from the scheme and their earnings will be based on people’s monthly profits over three years.
Aid will be backdated to March and arrive directly in one lump=sum into people’s bank accounts via the taxman, but not until June.
The chancellor said the scheme would cover 95% of those who earn most of their income from self-employment.
There are approximately five million people registered as self-employed in the UK and about 3.8m are expected to benefit from the scheme, according to the Treasury,
Also, the scheme will not accept applications but will rely on HMRC contacting self-employed individuals they deem eligible for the government assistance.
Paul Goodman, chairman of the NACFB, said: “We know that last night’s announcements from the Chancellor won’t go far enough to impact most of our membership.
“We have therefore made the right decision to pause the collection of all existing broker membership fees – a far more substantial measure than any three-month holiday period.
“We want our loyal members to be able to lean on their trade body during this difficult time and feel supported, not just in terms of our service, but financially too.”
No membership fee direct debits will be made for any existing NACFB brokerage for the next four months, from April until July 2020.
24% of the NACFB membership has leasing and asset finance as their primary area of business.