The Government’s SME Recovery Loan Scheme is designed to support economic recovery and to provide continued assistance to SMEs impacted by COVID-19.
On 25 August 2021 the government announced that the current requirements for loan approval have been updated to include more businesses.
The scheme is now open to businesses who have a turnover of <$250 million.
Participating lenders are offering guaranteed loans on the following terms under the SME Recovery Loan Scheme:
The Government guarantee will be 80% of the loan amount
Lenders are allowed to offer borrowers a repayment holiday of up to 24 months – please be aware that during this time interest capitalises on the loan
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, 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
Loans can be either secured or unsecured
The interest rate on loans will be determined by lenders, but will be capped at 7.5%
Loans backed by the Scheme will be available through participating commercial lenders. The decision on whether to extend credit, and management of the loan, will remain with the lender.
Loans are available from 1 April 2021 until 31 December 2021.
Given this detail has just been released, it will take a little while for lenders to have this product ready.
For more information on how to apply, click HERE.