Here is a summary of keys points of the COVID-19 SME Guarantee Loans:
 
  • The maximum total size of loans of $250,000 per borrower.
  • Loans must be for business purpose – specifically for working capital purpose not be used for asset purchases or refinancing
  • The loan terms will be up to three years, with an initial six-month repayment holiday (repayment holiday is optional)
  • 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.
  • The loan includes online redraw capability, which means customers will only pay interest on drawn balances.
  • Rates being offers are from 4.5%
  • CBA and NAB are offering this too new to bank and existing customers - Westpac is existing customers only at this stage – ANZ will be the same when released
  • All lenders have stated that the quickest and easier path for clients here is through your existing Business bank – either through your Business Banking Relationship Manager or via the website – feel free to reach out to us for specific ways to get this started.
  • Applicants will need to show they can repay the loan within 2.5 years based on financial data provided against the banks servicing thresholds
  • Loans will be available up until 30 September 2020.
  • Each bank is supporting these loans through has a new fast track application and approval process (see below)
  • No application or loan service fees will apply

THE PROCESS

1.     Client / SME to make an initial enquiry - either through your business relationship manager, phone, or via an online form on the bank’s website
2.     A bank representative will then make contact with Client / SME - timeframes vary between 2 - 5 days – this is a Pre-qualification call of the client and loan needs
3.     Bank sends application form for completion plus list of required documents required (see below)
4.     Client / SME completes an application form and provides supporting documents
5.     Application assessment and approval/decline
6.     Loan offers documents sent to the client
7.     Client / SME signs loan offer documents– banks are offering an online / email solution for this.
8.     Settlement > Disbursement of funds.

TIME FRAMES

 
  • Banks are hoping that for existing customers who turnaround  the required information quickly (1-2 days), that this process should take only a few weeks to settle the funds.  
  • New to bank customers timeframes will be longer as their document requirements will be more and assessment of their application will, therefore, take longer.

SUPPORTING DOCUMENTATION REQUIRED

  • Each banks documentation requirements are slightly different, but you will need to have your last 6-12 months BAS statements AND / OR your 2019 Financials statements (depending on the client, business, industry and existing relationship to the bank)
  • We suggest having your last 12 months BAS statements PLUS 2019 Financials statements available to assist for both the Pre-qualification chat (step 2 above) and for loan submission (step 4 above) in case they ask for both.
  • After your initial Pre-qualification call, the bank will send the client a list of docs required PLUS an application form to complete
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