July 24, 2020
The Federal Government has extended a loan scheme to help small and medium-sized business recover from COVID-19 crisis.
Federal Member for Wide Bay Llew O’Brien said the Coronavirus SME Guarantee Scheme had already helped more than 15,600 businesses across Australia with loans worth a total of $1.5 billion.
“To help businesses move into a COVID-safe economy, we’re now extending the purpose of loans for a wider range of investment, increasing the maximum loan size from $250,000 to $1 million per borrower and increasing the maximum loan term from three years to five years,” Mr O’Brien said.
“The next phase of the Coronavirus SME Guarantee Scheme will help businesses move out of hibernation, rebuild, adapt and create jobs on the other side of the coronavirus crisis.”
Under Phase 1 of the scheme, the government has been providing support in partnership with 44 approved lenders by guaranteeing 50 per cent of new unsecured loans to SMEs.
Key changes under Phase 2 include:
- Extending the purpose of loans able to be provided beyond working capital, such that a wider range of investment can be funded;
- Permitting secured lending (excluding commercial or residential property);
- Increasing the maximum loan size to $1 million (from $250,000) per borrower;
- Increasing the maximum loan term to five years (from three years); and
- Allowing lenders the discretion to offer a repayment holiday period.
Phase 1 will run until September 30; Phase 2 will start on October 1 and will be available until June 30, 2021.