(Bloomberg) --

The U.K. government and financial regulators have an urgent message to the country’s banks: lend.

In a joint letter to the industry, the U.K. Treasury, Bank of England and Financial Conduct Authority said they appreciated the work banks have done to support the economy during the coronavirus pandemic but further action is needed to ensure government and central bank programs benefit the borrowers most in need.

Banks will need to show “a willingness to maintain and extend lending despite the uncertain economic conditions,” Chancellor of the Exchequer Rishi Sunak, BOE Governor Andrew Bailey and FCA Interim Chief Executive Officer Chris Woolard said in the letter published Wednesday. “We must ensure that firms whose business models were viable before this crisis remain viable once it is over.”

The intervention comes after the U.K. unleashed record fiscal spending programs, slashed interest rates and relaxed rules on the banking industry to try to keep credit flowing through the economy. While the banking industry has pledged to do its part, there are signs that the aid may be slow to reach firms.

“With uncertainty being very high, banks are going to be a little more reluctant to take on greater risk to companies, especially as they know that companies today will not be thinking about investing and business expansion,” said Azad Zangana, senior European economist and strategist at Schroders Plc. “I’m sure a lot of the banks will try to do their best to help, I’m sure they will be extending credit facilities to good customers to make sure they can get through this period of disruption, but I highly doubt we’ll see a sharp rise in lending.”

To support the economy during the outbreak, the BOE is providing banks four-year loans at or very close to the benchmark rate -- now 0.1% -- and offering additional funding to those that increase lending, especially to smaller firms.

©2020 Bloomberg L.P.