More small and medium businesses (SMEs) will be able to receive funds under the Federal Government’s ‘SME Recovery Loan Scheme’ following changes to eligibility criteria announced today.
The Federal Government says, in recognition of the ongoing economic impacts caused by COVID-19 restrictions, requirements will be removed for SMEs to have received JobKeeper during the March quarter of 2021 or to have been a flood-affected business in order to be eligible under the Scheme.
As with the existing scheme, SMEs who are dealing with the economic impacts of the coronavirus with a turnover of less than $250 million will be able to access loans of up to $5 million over a term of up to 10 years.
In addition:
- The Government guarantee will be 80 per cent of the loan amount.
- 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 to support investment.
- Loans may be used to refinance any pre-existing debt of an eligible borrower, including those from the SME Guarantee Scheme.
- Loans can be either unsecured or secured (excluding residential property).
The loans will be available through participating lenders until 31 December 2021.
More information about the SME Recovery Loan Scheme can be accessed via the Federal Treasury website.
Updated at 2.23pm AEST on 25 August 2021.
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