Conoravirus SME Guarantee Scheme offers cash flow relief to small businesses
Kate Carnell
Company Director - Chair Mable, Chair Racing and Sport Technology, Deputy Chair BeyondBlue, Chair Violet , Director Australian Made, National Co -Convenor of Liberals for Yes
As Australian small businesses make tough decisions about their future and consider the ways they can come through to the other side of this health crisis, cash flow is key.
Small businesses with a turnover of up to $50 million can apply for loans to help with cash flow over the coming months.
Under the Coronavirus SME Guarantee scheme, small businesses – including sole traders - can apply for a loan of up to $250,000.
The Government is underwriting 50% of these new unsecured loans for SMEs to use as working capital.
To explain, the loans are unsecured and that means you don’t have to provide an asset as security for the loan.
Your bank will look at your capacity to repay the loan, but they are taking into account the uncertainty of business conditions for the foreseeable future.
The loans will be for a duration of up to 3 years, with an initial 6 month repayment holiday.
To be clear, small businesses that take up one of these loans do not need to worry about getting hit with a lump sum bill after that 6 month period.
The interest accrued during that time will be spread over the course of the loan period. You will not get a big bill.
This scheme comes into play in early April – so from next week – and these new low-cost loans will be available to small businesses until the end of September.
So how to apply? Give your bank a call and they will talk you through it.
CEO @ Butterfly | Operational Excellence | Prostheses tracking
4 年The policy make should take a measure how much loans have been delivered to SMEs after government guaranteed scheme. Even my bank manager said to me that most of people can not get this loan out of bank because they do not have enough cash flow to pay back this 3 year loan. Between death and hibernation it is very fine line! Does our government have monitoring system to rescue all the dying businesses?
Retail Specialist at Coles
4 年Where do a new business owner stand on all this , i am new business owner and just started 3 weeks ago , i am not i will be able to get some help from either bank or goverment , as i dont have much of a trading history , it hard to start a new bussiness and on the top we are now facing 80- 90 % drop in sales ... hope bank will look into account all that so far i dont think i will be making it to the other end ....
The guy from Special Circumstances | I fix Tech organisations
4 年Though the financial crisis we are having is mostly due to banks happily doing business loans like they are going out of style.. Loans aren't cashflow, they are liabilities
Professional Independent Chairman | Australia's #1 Authority On Leveraging Growth Through Advisory Boards | Independent Director | Business Mentor
4 年Thanks for keeping the SME community updated Kate. With everything changing rapidly it is important to have a source of trust and advocacy
Co-Founder Firefly HR Education & Care Recruitment | Strategic & community driven leader with a background in education, business management & stakeholder engagement that has a passion for fostering inovation.
4 年Tried our bank several times already since Monday and still waiting for info - yet to have anything from the bank. Multiple ‘request callbacks’ as well ??♀?