(13 December 2021 – Australia) The Australian federal government is extending the small and medium sized enterprise (SME) loan scheme for another six months until the end of H1 2022.
Treasurer Josh Frydenberg announced that the SME Recovery Loan Scheme will remain available to firms with sub A$250 million turnover until 30 June 2022 after originally being planned to conclude at the end 2021.
Microbusinesses, SMEs and smaller sized commercial “middle market” enterprises adversely economically affected by the COVID‑19 pandemic will be able to access loans of up to A$5 million over a term of up to ten years to support them managing the adverse economic impacts of COVID-19. Other key features of the SME Recovery Loan Scheme include:
- Lenders can offer borrowers a repayment holiday of up to 24 months.
- Loans can be used for a broad range of business purposes, including to support investment.
- Loans may be used to refinance any pre-existing debt of an eligible borrower.
- Loans can be either unsecured or secured (excluding residential property).
“Around 80,000 loans worth approximately A$7.3 billion have been written to date since the scheme commenced in March 2020. The extension of the scheme continues our unprecedented support for SMEs and will help even more businesses get access to the funding they need to adapt, innovate and bounce back from the impacts of the pandemic” stated Federal Treasurer The Hon Josh Frydenberg MP.
“With our economy showing signs of a strong rebound as restrictions ease, the Government will reduce its loan guarantee from 80 per cent to 50 per cent, helping drive a private sector-led recovery” Mr Frydenberg added.
“The Federal Government’s SME Recovery Loan Scheme will provide a lifeline to businesses that need more time and support to get back on their feet following the impacts of the COVID-19 pandemic and flood” commented Westpac Chief Executive Consumer & Business Banking, Chris de Bruin.
“Small business is the engine room of the Australian economy and it is essential we stay the course to help these businesses keep going and growing as part of Australia’s broader economic recovery. This targeted support is needed for sectors and geographies that are still facing ongoing challenges due to the effects of the pandemic.”
“The new loans give small businesses access to low-rate finance, with the option of deferring repayments, to provide further breathing space for business owners. From tourism operators in Queensland, to hospitality business owners in South Australia, we have had strong interest from customers in accessing the SME Recovery Loan Scheme to help them get through the challenges ahead” said Mr de Bruin.