# Loan guarantee scheme extended and expanded



## Jack Malarkey (Jan 11, 2016)

The Australian Government earlier today (Monday 20 July 2020) announced an extension and expansion of its loan guarantee scheme known as the Coronavirus SME Guarantee Scheme.

Treasurer media release:

Supporting small business to adapt, grow and create jobs | Treasury Ministers









ministers.treasury.gov.au

20 July 2020

Supporting small business to adapt, grow and create jobs

Senator the Hon Michaelia Cash
Minister for Employment, Skills, Small and Family Business

The Morrison Government will help businesses as they move into the recovery phase of the coronavirus crisis by extending the Coronavirus SME Guarantee Scheme which supports small and medium sized businesses (SMEs) to get access to the funding they need to adapt and innovate during the coronavirus crisis.

Under the existing Scheme, the Government is providing an unprecedented level of support to SMEs in partnership with 44 approved lenders by guaranteeing 50 per cent of new unsecured loans to SMEs. The Scheme has already seen more than 15,600 businesses accept loans worth $1.5 billion.

The next phase of the Coronavirus SME Guarantee Scheme will help businesses move out of hibernation, successfully adapt to the new COVID-safe economy and invest for the future.

Key changes to the Scheme include:

Extending the purpose of loans able to be provided beyond working capital, such that a wider range of investment can be funded;
Permitting secured lending (excluding commercial or residential property);
Increasing the maximum loan size to $1 million (from $250,000) per borrower;
Increasing the maximum loan term to five years (from three years); and
Allowing lenders the discretion to offer a repayment holiday period.
The extended terms of the Scheme will enable lenders to continue supporting Australian small businesses when they need it most. The expanded Scheme will shift from providing access to working capital to helping businesses stay afloat during the crisis to now also enabling them to access more affordable and longer term credit so that they can invest for their future.

The initial phase of the Scheme remains available for new loans issued by eligible lenders until 30 September 2020. The second phase of the Scheme will start on 1 October 2020 and will be available until 30 June 2021.

The Morrison Government will continue to support small businesses as they seek to rebuild, adapt and create jobs on the other side of the coronavirus crisis.


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## bycastory (Apr 27, 2021)

This was something expected. America did the same thing a while ago.


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## Jack Malarkey (Jan 11, 2016)

Media release by the federal Treasurer:






Supporting more small and medium sized business to access funding | Treasury Ministers







ministers.treasury.gov.au





25 August 2021

*Supporting more small and medium sized business to access funding*

The Morrison Government is providing additional support to small and medium sized businesses (SMEs) who continue to deal with the economic impacts of the COVID‑19 crisis by expanding eligibility for the SME Recovery Loan Scheme.

In recognition of the continued economic impacts of COVID‑19, the Government will remove requirements 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 SME Recovery Loan 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. Other key features of the SME Recovery Loan Scheme include:

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 expanded Scheme will enable lenders to continue supporting Australian small businesses when they need it most.

The SME Recovery Loan Scheme builds on earlier loan schemes introduced during COVID‑19, under which around 74,000 loans totalling around $6.2 billion were written.

The loans will be available through participating lenders until 31 December 2021. The expansion complements other financial support the Commonwealth is offering to businesses impacted by the current COVID‑19 health restrictions.

The Morrison Government will continue to support small businesses as they seek to rebuild, adapt and create jobs on the other side of this crisis.

Further information can be found on the Treasury website.


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