Battling Traders Seize Virus Loan Scheme
Posted by Tingyu
Small and medium businesses have borrowed more than $150 million from the Commonwealth Bank as they battle the effects of the coronavirus pandemic.
The loans are part of the federal government’s Coronavirus SME Guarantee Scheme, which became available on March 23. The government guarantees 50 per cent of the loan amount.
Commonwealth Bank says more than 1,850 traders have taken loans and nearly 70 per cent of the businesses are from NSW.
Hospitality operators accounted for 15 per cent of the businesses receiving loans followed by construction (13 per cent), professional services (12 per cent) and retail (11 per cent).
The hospitality sector has been among the hardest hit by restrictions on public gatherings to slow the spread of the virus.
Most banks last month announced a host of measures, such as the scrapping of fees and postponing repayments, to help businesses and individuals.
Australian Banking Association chief executive Anna Bligh says borrowers who opt for a six-month deferral on mortgage payments will not have anything recorded on their credit history, provided they are up to date at the time of deferral.
Monday’s announcement follows talks between credit agencies and Australian banks.
“That is good news for all those people who need this relief and they need it now,” Ms Bligh said.
“They can go and talk to their bank and be completely relaxed that this deferral will not affect their credit rating.”
Similarly, people who postpone repayments will not be reported as having missed payments in their credit history.
Australian Retail Credit Association chief executive Mike Laing said people should contact their credit provider as early as possible to discuss help.