SME Recovery Loan Scheme (Phase 3)

To assist SME business cope with the economic impact of the coronavirus crisis , the Australian Federal Government introduced the SME Recovery Loan Scheme (the Scheme) as a financial support.

As the Coronavirus Pandemic continues, the Government has announced that the SME Recovery Loan Scheme would be expanded from 1 October 2021, so eligible SME’s will have access to finance to maintain and grow their businesses.
https://treasury.gov.au/coronavirus/sme-recovery-loan-scheme2

Features of the SME Recovery Loan Scheme:

• the Government will guarantee 80% of the loan amount
• a repayment holiday of up to 24 months is allowed to be offered by lenders to borrowers
• loans can be used for various business purposes (including investment support)
• any pre-existing debt (including loans from the SME Guarantee Scheme) may be re-financed for eligible borrowers
• borrowing available up to $5 million in total, in addition to the Phase 1 and Phase 2 loan limits
• loan terms up to 10 years (repayment holiday period optional)
• loans can be either unsecured or secured (excluding residential property)
• lenders will determine the interest rate on loans, but interest rates will be capped at around 7.5% (there will be some flexibility for interest rates on variable rate loans to increase if market interest rates rise over time).

Participating lenders approved for the SME Recovery Loan Scheme include various banks, finance companies and credit unions.

Applications are open until 31 December 2021.