The NSW government is offering an interest-free business loan that allows small- to medium-sized enterprises to benefit from funds that are usually only available to secure businesses needing more capital. As long as your business can demonstrate the amount of revenue and further growth that are prerequisites for a government loan, you are able to apply for this extra capital.
This opportunity is a real boost to newer businesses because they tend to have an unsecured lending history and are often unable to obtain commercial financing. This initiative is put forward by the NSW government, which means only businesses within NSW are eligible.
For information on what interest-free business loans are available during the coronavirus outbreak, click here.
How does an interest-free business loan work?
An interest-free business loan works the same way as any other business loan. Before you apply for the amount your business needs, figure out whether the loan terms and repayments are something your business can take on. The loan offered by the NSW government has a loan term of four years with varying repayment plans and includes the flexibility of multiple payment advances, which can offer peace of mind.
The loan doesn't require any personal assets to be secured, such as a residential property or a vehicle, but while you're paying off your loan, Jobs for NSW will place security over all general and future assets of the business.
What types of interest-free business loans are available?
The Regional Growth Loan is an interest-free loan that specifically assists businesses creating jobs in regional areas outside Sydney, Newcastle and Wollongong. There is no interest payable on this loan. The minimum amount is $200,000 and the maximum is $500,000. This loan does not need to be secured by personal assets. The loan term for is four years. There are no establishment fees or early repayment penalties charged with this loan.
Alternative business loans from NSW government
If your business is not eligible for the Regional Growth Loan, the NSW government also offers two alternative loan options to consider which are charged interest:
The Strategic Growth Loan is flexible and offers direct capital to emerging and fast-growing businesses that are scaling quickly. This loan offers a minimum of $500,000 and a maximum of $1,200,000. This is offered over four years with an interest rate of 9.2%.
The Accelerating Growth Loan is also flexible and for businesses that are growing within the state of NSW. The minimum for this loan is $200,000 and it has a maximum of $500,000. The interest rate for this loan is a fixed 9.2% for the term of the loan, which is four years.
There are no establishment fees with these loans, nor are there any penalties for early repayment.
Is my business eligible for an interest-free business loan?
The eligibility criteria for the Strategic Growth Loan are:
Have an Australian Business Number (ABN) and be an incorporated company
Have a minimum of five employees (full-time, part-time or casual)
Create a minimum of 20 new jobs within the next 3 years in NSW
Demonstrate a likely revenue of at least $1 million within the next year
Be trading for at least a year
Demonstrate further growth for a minimum of one year, shown through future pipelines or contracts
Be unable to obtain commercial finance
The eligibility criteria for the Accelerating Growth Loan are:
Have an ABN and be an incorporated company
Have a minimum of five employees (full-time, part-time or casual)
Create a minimum of 10 new jobs within the next 2 years in metropolitan NSW (Sydney, Newcastle and Wollongong)
Demonstrate a likely revenue of at least $500,000 within the next year
Be trading for at least a year
Demonstrate further growth for a minimum of one year, shown through future pipelines or contracts
Be unable to obtain commercial finance
The eligibility criteria for a Regional Growth Loan are:
Have an ABN and be an incorporated company
Have a minimum of five employees (full-time, part-time or casual)
Create a minimum of 10 new jobs within the next 2 years outside of metropolitan NSW (Sydney, Newcastle and Wollongong)
Demonstrate a likely revenue of at least $500,000 within the next year
Be trading for at least a year
Demonstrate further growth for a minimum of one year, shown through future pipelines or contracts
Demonstrate they have been unable to obtain commercial finance
What do I need to consider before applying?
Once you've read the eligibility criteria, it's important to consider whether or not your business is going to grow and meet the standards that are set by the NSW government. Once you've considered this, it's also important to consider the hiring capabilities of your business, because some of the loan requirements are that you have to add 10 or 20 employees over the next 3 years.
As there are no fees for early repayments or any establishment fees, another thing to consider is the penalties that might be associated with this loan, such as if you make a late payment.
Interest-free business loans during the coronavirus outbreak
If you're looking for an interest-free business loan because your business has been affected by the recent pandemic, there are some options available. In order to help small businesses, the Queensland government is offering $500 million in loans that are are interest-free for the first 12-months. While Queensland is the only state offering these types of loans, other states may follow suit in the coming weeks/months.
If your business is being affected by coronavirus and you are not based in Queensland and do not qualify for the loans outlined on this page, there may be some other forms of financial assistance that you qualify for.
The big banks are also making special concessions for small businesses. So, if you have an existing business loan, you may be able to contact your bank and suspend your interest repayments, or your repayments altogether.
Frequently asked questions
As this initiative is run by the NSW government, only NSW businesses are able to benefit from this. Businesses in other areas can compare alternative options here.
No, you can't. This loan is only eligible to small- to medium-sized businesses who are unable to obtain commercial finance to help their businesses grow.
You can send an email to enquiries@jobsfornsw.com.au or call 1300 JOB NSW ( 1300 562 679).
You are not required to talk to a financial adviser, but it's highly recommended as they will help you assess the suitability of a loan for your business and whether or not the loan you're going after meets your needs.
Our business loan engine is completely free to use. There are no costs at all for you to use our database to find a better deal. Better still, we regularly run exclusive deals that you won't find on any other site.
We're experts
We've researched and reviewed hundreds of loans, down to the fine print. Our database and tables are always up-to-date and our in-house experts regularly appear on Sunrise, 7News and SBS News.
We're independent
We are independently owned and have a mission to help Australians make better financial decisions. That means our opinions are our own and you can compare nearly every business loan in Australia on the site (and find a better deal).
We're here to help
Since 2015, we've helped 50,000+ people find a business loan by explaining the options simply. You don't need to give us any details to use our tables. We're here to help you make a decision.
How likely would you be to recommend finder to a friend or colleague?
0
1
2
3
4
5
6
7
8
9
10
Very UnlikelyExtremely Likely
Required
Thank you for your feedback.
Our goal is to create the best possible product, and your thoughts, ideas and suggestions play a major role in helping us identify opportunities to improve.
Important information about this website
finder.com.au is one of Australia's leading comparison websites. We are committed to our readers and stands by our editorial principles
We try to take an open and transparent approach and provide a broad-based comparison service. However, you should be aware that while we are an independently owned service, our comparison service does not include all providers or all products available in the market.
Some product issuers may provide products or offer services through multiple brands, associated companies or different labeling arrangements. This can make it difficult for consumers to compare alternatives or identify the companies behind the products. However, we aim to provide information to enable consumers to understand these issues.
We make money by featuring products on our site. Compensation received from the providers featured on our site can influence which products we write about as well as where and how products appear on our page, but the order or placement of these products does not influence our assessment or opinions of them, nor is it an endorsement or recommendation for them.
Products marked as 'Top Pick', 'Promoted' or 'Advertisement' are prominently displayed either as a result of a commercial advertising arrangement or to highlight a particular product, provider or feature. Finder may receive remuneration from the Provider if you click on the related link, purchase or enquire about the product. Finder's decision to show a 'promoted' product is neither a recommendation that the product is appropriate for you nor an indication that the product is the best in its category. We encourage you to use the tools and information we provide to compare your options.
Where our site links to particular products or displays 'Go to site' buttons, we may receive a commission, referral fee or payment when you click on those buttons or apply for a product. You can learn more about how we make money.
When products are grouped in a table or list, the order in which they are initially sorted may be influenced by a range of factors including price, fees and discounts; commercial partnerships; product features; and brand popularity. We provide tools so you can sort and filter these lists to highlight features that matter to you.
Please read our website terms of use and privacy policy for more information about our services and our approach to privacy.
