MBV would like to remind members that the Federal Government has extended its Small and Medium Enterprises (SME) Loan Guarantee Scheme until June 2022.
The Federal Government has recently extended its Small and Medium Enterprises (SME) Loan Guarantee Scheme until June 2022.
The scheme supports SMEs to get access to funding to adapt, innovate and bounce back from the impacts of the COVID-19 pandemic.
Businesses that have been adversely affected economically by COVID19 are eligible for the Scheme.
This includes assisting businesses with access to finance to manage cash flow challenges arising from COVID-19, which are related to unprecedented materials and cost increases.
SMEs with a turnover of less than $250 million dealing with the economic impacts of COVID-19 can access loans of up to $5 million over a term of up to 10 years.
Participating lenders are offering guaranteed loans on the following terms under the SME Recovery Loan Scheme (2022 Scheme expansion):
- The Government guarantee will be 50 per cent of the loan amount.
- The expanded scheme will not be available for loans to flood-affected SMEs not adversely economically affected by COVID-19.
- The expanded scheme will commence on 1 January 2022 and end on 30 June 2022.
- Lenders are allowed to offer borrowers a repayment holiday of up to 24 months.
- Loans can be used for a broad range of business purposes, including investment support.
- Loans may be used to refinance any pre-existing debt of an eligible borrower, including those from the SME Guarantee Scheme.
- Borrowers can access up to $5 million in total, in addition to the Phase 1 and Phase 2 loan limits.
- Loans are for terms of up to 10 years, with an optional repayment holiday period.
- Loans can be either unsecured or secured (excluding residential property).
- The interest rate on loans will be determined by lenders but will be capped at around 7.5 per cent, with some flexibility for interest rates on variable rate loans to increase if market interest rates rise over time.
The Government is currently considering applications from lenders interested in participating in the SME Recovery Loan Scheme. The following lenders have been approved to participate in the SME Recovery Loan Scheme.
- Bank of Queensland
- Commonwealth Bank of Australia
- Fifo Capital Australia
- Get Capital
- Judo Bank
- Liberty Finance
- Moneytech Finance
- National Australia Bank
- Regional Australia Bank
- Social Enterprise Finance Australia
- South West Credit Union Co-operative
- The Mutual Bank
- TrailBlazer Finance
- Unity Bank
Click here for more information on the scheme.
For further information or assistance, members are encouraged to call our Assist Team on (03) 9411 4555.