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Extension and Expansion of SME Loan Scheme Announced

Published by:
James Morris
Published on:
August 04, 2020
Modoras Accounting (QLD) Pty Ltd ABN 81 601 145 215
Extension and Expansion of SME Loan Scheme Announced

To further assist small and medium sized businesses in adapting during the COVID-19 crisis, the Coronavirus SME Guarantee Scheme has been extended to June 30 next year.

The scheme has had limited popularity to date with only 15,600 businesses obtaining loans worth a combined $1.5 billion. The scheme had a planned value of $40 billion.

To attract more SMEs to the scheme, the treasurer has announced a post-September tailoring of the scheme.

The loans will be modified to extend past working capital, allowing for a much wider range of investment purchases.

The initial phase of the scheme will remain available for new loans issued by eligible lenders until 30 September 2020. This second phase will kick off on 1 October 2020 and run till 30 June 2021.

Overview of changes

  • Loans can be provided for purposes other than working capital
  • Secured loans will be permitted in addition to unsecured loans
  • The maximum loan size will increase to $1 million (from $250,000)
  • The maximum loan term will increase to five years (from 3 years)
  • Lenders have additional discretion on offering repayment holidays

The expanded scheme has been specifically designed to help businesses that are staying afloat prepare with longer term solutions in the post-COVID environment.

Modoras is here to support you during these difficult times. From building a resilient business to any business questions you may have, contact us on 1300 888 803 book a catch up with a Modoras professional.

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IMPORTANT INFORMATION: This blog has been prepared by Modoras Accounting (QLD) Pty. Ltd. ABN 81 601 145 215. The information and opinions contained in this blog is general information only and is not intended to represent specific personal advice (Accounting, taxation, financial, insurance or credit). No individuals’ personal circumstances have been taken into consideration for the preparation of this material. The information and opinions herein do not constitute any recommendation to purchase, sell or hold any particular financial product. Modoras Accounting (QLD) Pty. Ltd. recommends that no financial product or financial service be acquired or disposed of or financial strategy adopted without you first obtaining professional personal financial advice suitable and appropriate to your own personal needs, objectives, goals and circumstances. Information, forecasts and opinions contained in this blog can change without notice. Modoras Accounting (QLD) Pty. Ltd. does not guarantee the accuracy of the information at any particular time. Although care has been exercised in compiling the information contained within, Modoras Accounting (QLD) Pty. Ltd. does not warrant that the articles within are free from errors, inaccuracies or omissions. To the extent permissible by law, neither Modoras Accounting (QLD) Pty. Ltd. nor its employees, representatives or agents (including associated and affiliated companies) accept liability for loss or damages incurred as a result of a person acting in reliance of this publication. Liability limited by a scheme approved under Professional Standards Legislation.

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