Search
  • BBCC

Temporary relief for financially distressed businesses.

(Please note the below are only temporary law changes).


Supporting the flow of credit (scheme commences early April 2020).

https://treasury.gov.au/coronavirus/business-investment  for more updates in the future.




Under the Scheme, the Government will provide a guarantee of 50 per cent to SME lenders for new unsecured loans to be used for working capital. This will enhance these lenders’ willingness and ability to provide credit, which will result in SMEs being able to access additional funding to help support them through the upcoming months.  SMEs with a turnover of up to $50 million will be eligible to receive these loans.  The Government will provide eligible lenders with a guarantee for loans with the following terms:  • Maximum total size of loans of $250,000 per borrower.  • The loans will be up to three years, with an initial six month repayment holiday.  • The loans will be in the form of unsecured finance, meaning that borrowers will not have to provide an asset as security for the loan.

Loans


will be subject to lenders’ credit assessment processes with the expectation that lenders will look through the cycle to sensibly take into account the uncertainty of the current economic conditions. As part of the loan products available, the Government will encourage lenders to provide facilities to SMEs that only have to be drawn if needed by the SME. This will mean that the SME will only incur interest on the amount they draw down. If they do not draw down any funds from the facility, no interest will be charged, but they will retain the flexibility to draw down in the future should they need to. 

The Scheme will commence by early April 2020 and be available for new loans made by

participating lenders until 30 September 2020.


0 views
 

©2020 by Bayswater & Beyond Chamber of Commerce. Proudly created with Wix.com