Business loans for SMEs affected by the coronavirus outbreak
If your business is struggling in the face of the pandemic, find out what finance options can help.
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It's been a rocky start to the new decade for Aussie businesses, to say the least. Businesses still recovering from the impact of the bushfires are now having to face cancelled events, dwindling customers and supply chain disruptions as a result of the coronavirus outbreak. It's taking a real toll on companies, particularly SMEs. If you're a business owner and you're facing financial issues as a result of the pandemic, there might be low or no-cost financing options that can help. Find out more about what business loan options are available during the coronavirus outbreak below.
We'll continue to update this page with resources and information as new details emerge in the world's response to COVID-19.
Update: 20 March 2020
A Small Business Relief Package has been announced for small businesses that have been affected by COVID-19. The relief package, which has been authorised by the Australian Competition and Consumer Commission (ACCC) and implemented by the Australian Banking Association (ABA) and the banks, will defer all principal and interest payments for loans to small businesses that have been affected by COVID-19. It is available to businesses in any sector.
Any small business who has not already been contacted by their bank about the Small Business Relief Package is being urged to get in touch with their bank. Banks have already begun contacting their customers and the packages will start rolling out in full on Monday.
Find out more details about this relief package here.
Where to find financial help for your business during the coronavirus outbreak
The ATO, national and state governments and the banks are offering businesses various forms of support during this time of crisis.
12 March 2020
A $17.6 billion package was announced to assist households and small businesses.
22 March 2020:
A further $66 billion stimulus package was announced to aid citizens and small businesses during the outbreak.
Update 30 March 2020:
The government has announced a $130 billion JobKeeper Payment wage subsidy package to support businesses and employees. Businesses may be eligible to receive up to $1,500 per employee on a fortnightly basis. This would then be passed on in full to eligible workers. This will be available until 27 September 2020.
Business loans backed by the government are currently being made available to businesses affected by coronavirus across Australia. These government-backed business loans under the recently announced Coronavirus SME Guarantee Scheme, are loans of up to $250,000 that are available to eligible Australian SMEs. These loans will all be unsecured with terms of up to three years with no repayments required for six months. There will also be no interest charged on these loans for unused funds - borrowers are only charged on what they draw down. Loans under this scheme also have no fees attached.
These loans will be made available to businesses until 30 September 2020.
Coronavirus SME Guarantee Scheme update
Good news for businesses – the Australian Government has introduced a second phase of the Coronavirus SME Guarantee Scheme. This second phase will see broader eligibility criteria, as well as loan terms and loan amounts being increased. While the current phase of the scheme is set to end on 30 September 2020, the second phase will be initiated from 1 October 2020 until 30 June 2021.
Is my bank offering the Small Business Relief Package?
The following banks are participating in this scheme:
|ANZ is offering business loans to new and existing customers affected by the coronavirus pandemic in line with the scheme.|
New business loan customers can apply for loans under the scheme in the form of a business loan and business overdraft up to $250,000 with six month repayment deferral periods. After the six month period, overdraft users have the option of fully repaying the overdraft or rolling the balance into a term loan for up to 2.5 years.
Bank of Queensland
|The Bank of Queensland is offering up to $250,000 in unsecured overdrafts for new and existing business customers under the Coronavirus SME Guarantee Scheme.||More info|
Bank of us
|The Bank of us is offering Tasmanian businesses access additional working capital in the form of overdrafts at a rate of 5.49% p.a. to support them through the upcoming months under the Coronavirus SME Guarantee Scheme. The loans are subject to normal Bank of us credit assessment processes.|
|Bankwest has also confirmed that it will be providing lower rate business loans that comply with the terms of the scheme. The exact rates of these loans are yet to be released.||More info|
Bendigo and Adelaide Bank
|Bendigo and Adelaide Bank recently announced that the partnership will be participating in the scheme, but is still finalising the details of the loans.||More info|
|CommBank announced that it would be making up to $10 billion in funds available for additional small business loans in line with the coronavirus relief scheme. The bank also said that interest rates on the new unsecured loans would be 5% p.a. lower than normal.||More info|
|Customers can apply for a business overdraft, term loan or a working capital facility with GetCapital. The business overdraft is a revolving facility, where you only draw down on what you need and incur interest (deferred for the first 6 months) on the amount used. The term loan and working capital facility give successful applicants immediate access to approved funds in a single lump sum, with an online redraw option.||More info|
|Heritage Bank is now offering government backed business loans under the Coronavirus SME Guarantee Scheme and applications are now open. New and existing applicants can apply.||More info|
|Under the Coronavirus SME Guarantee Scheme, IMB Bank's small business customers and sole traders can access loans of up to $75,000 to help bolster the working capital they need.|
|Judo Bank is an SME-focussed challenger bank. It was recently awarded an additional $500 million in funding from the Australian government. This is in addition to its participation in the Coronavirus SME Guarantee Scheme.||More info|
|Liberty is offering business care loans from $25,000 to $250,000 (with repayments deferred for 6 months and interest capitalised) in line with the Coronavirus SME Guarantee Scheme.|
|Lumi is offering new and existing customers a small business loans and business lines of credit available from $2,000 to $250,000 in line with the scheme. Borrowers do not need to make repayments for the first 6 months.||More info|
|Macquarie Bank have been approved to offer loans under the Coronavirus SME Guarantee Scheme.|
|Moula is still finalising the details of its government backed loans under the Coronavirus SME Guarantee Scheme. Loans will be available to new and existing business customers.||More info|
|Under the government scheme, MyState are offering new and existing business loan customers access to loans of up to $250,000. Loans will be available at a rate of 5.5% p.a. at a variable rate, with no additional fees. Over the 6 month repayment holiday, funds from approved loans can be drawn down in 3 instalments.|
|OnDeck Capital are offering new and existing customers business loans under the Coronavirus SME Guarantee Scheme. OnDeck's loans are customised as per each individual business' needs. Repayment deferral periods with these loans will vary. The total interest payable is set out at the start of each loan|
|NAB has also agreed to partake in the government's Coronavirus SME Guarantee Scheme. Business loans up to $250,000 will be available from NAB at a rate of 4.5% p.a. with no repayments for the first six months.||More info|
Queensland Country Bank
|Queensland Country Bank are offering loans to businesses in line with the Coronavirus SME Guarantee Scheme. For full details of these loans, contact the lender directly.|
Regional Australia Bank
|Regional Australia Bank are also offering loans in line with the scheme. Contact the bank directly for further details.|
Southern Cross Credit Union (SCCU)
|The SCCU are offering a "Back to Business Loan" in line with the scheme at a variable rate of 4.40% p.a. and a "Back to Business Overdraft" at a rate of 6.40%p.a.|
|Speedy Finance are offering loans in line with the scheme from $20,000. Interest rates for Speedy Finance business loans under the Coronavirus SME Guarantee Scheme start from 18% p.a. All industries are considered, but applicants must have had a minimum 2 year ABN.||More info|
|Spotcap are offering small business loans in line with the Coronavirus SME Guarantee Scheme. Loans are issued according to Spotcap's underwriting criteria. Prospective borrowers should contact Spotcap for further details.||More info|
|St.George Bank has also announced that it will be participating in the scheme and new business loans are available effective as of 23 March 2020 to businesses affected by coronavirus.||More info|
|Suncorp also announced that it will be taking part in the scheme, but is still finalising the details of its loans.|
|Business loans under the Coronavirus SME Guarantee Scheme are available up to $250,000 to existing customers only.|
|Westpac announced its new business loans under the Coronavirus SME Guarantee Scheme on 22 March 2020. These loans will be offered at a 4% p.a. lower rate than Westpac's current unsecured business loan.||More info|
We strive to keep this list as updated as possible. If you do not see your bank or lender listed, it is still advisable to contact them regarding the scheme. You can also consult the government treasury website for a list of approved lenders.
The Small Business Relief Package
The ACCC has provided an urgent interim authorisation which will allow the ABA and Australian banks to implement a small business relief package. This package will allow banks to defer principal and interest payments for loans to small businesses for six months if they have been affected by COVID-19.
Businesses with existing loans are encouraged to get in touch with their bank if they haven't been contacted about their loans yet.
How the Small Business Relief Package will work
If your business is eligible for relief, your principal and interest payments will be delayed on all term and retail loans for a 6-month period. At the end of the period, you will not be required to pay the deferred interest in a lump sum. To repay the loan, the term of the loan will be extended or your repayments will be increased.
Banks can also choose to offer more favourable and tailored terms to small businesses who experience financial hardship.
Can I qualify?
The relief package is available to small businesses affected by COVID-19 in any sector. You need to have less than $3 million in total debt owed to credit providers.
How do I apply?
Banks have already started reaching out to their customers about the package and it will start rolling out in full on Monday. If you have not heard from your bank, you can get in contact with them directly.
Queensland is offering $500 million in business loans
Queensland is currently offering interest-free loans of up to $250,000 to businesses affected by coronavirus. These loans are available interest-free for 12 months and aim to help businesses cover costs and keep staff employed.
Tasmania is offering $20 million in small business support loans
The Tasmanian government has allocated $20 million towards interest-free loans for hospitality, tourism, seafood and export businesses with an annual turnover of less than $5 million. You can apply for a loan to purchase equipment or restructure business operations, with a maximum interest-free period of up to three years.
How to protect your business and employees during the coronavirus outbreak
As a business owner, it's your responsibility to take measures to protect your employees during this time.
- Send sick employees home. This one goes without saying, but if someone is showing symptoms, they should be sent home immediately.
- Remote working. If your employees can work from home, it's advisable to allow them to. People can carry the virus without showing symptoms. Slack, Zoom and Skype are your new best friends.
- Disinfect the workplace. If your employees can't work from home, it's important to keep a clean environment. Ensure that common areas and surfaces are clean, especially door handles, desks and keyboards. And stock up on hand sanitiser.
- Leave reminders on hygiene. While most people shouldn't require a reminder, some may. Hang posters reminding employees to wash their hands frequently and sneeze and cough into tissues. Encourage employees to avoid handshakes and contact where possible.
- Apply for financing. Even if you're unsure as to whether you may need finance right now, things can take a turn for the worse very quickly. Ensure the safety of your employees by applying for a government grant, interest-free loan or business loan.
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Frequently asked questions
Need to save some quick cash?
If you're struggling to keep up with your finances - you're not alone. You can save plenty of cash by doing some simple admin with your bills and expenses. Maybe switching credit cards or downgrading your mobile phone plan could save some money.
Managing your daily finances can help you get through this difficult time - You'll be glad you did it.
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