Australian banks extend loan deferrals to 30,000 more businesses
30 March 2020, Written by Business News Australia
More than 30,000 Australian businesses can now access the six-month loan repayment deferral program after the Australian Banking Association (ABA) decided to extend the relief.
Businesses with total loan facilities of up to $10 million (up from the $3 million small business threshold initially announced on 20 March 2020) will now be able to defer repayments for loans attached to their businesses for six months.
The ABA's support now extends to 98 per cent of all businesses with a loan from an Australian bank, and will apply to an additional $100 billion of business loans. This will bring the combined total of loan repayments deferred by Australian banks to $250 billion.
During this period banks have also agreed to not enforce business loans for non-financial breaches of the loan contract (such as changes in valuations).
The new measures will apply in all sectors of the economy, and on an opt-in basis, under the conditions that:
"As this crisis has deepened and more businesses are affected we are building on the Small Business Relief package to ensure more businesses are given a lifeline to help them survive through the coronavirus pandemic," says ABA CEO Anna Bligh.
"Banks are expanding their support to an extra 30,000 thousand businesses by raising the threshold of those who qualify for the six month deferral of loan repayments from $3 million to up to $10 million in total loan facilities.
"This will help protect many more thousands of small businesses from being evicted if they are struggling to pay the rent as it covers approximately 90% of commercial property owners who have loans with an Australian bank."
Updated at 11:30AM AEDT on 30 March 2020.
Author: Business News Australia