Access to credit for SMEs has been eased during the coronavirus crisis, especially for those businesses receiving the JobKeeper payment, with the Treasurer confirming in April that the big four will expedite loan applications lodged by JobKeeper applicants.
Another measure offered to SMEs has been the option to defer loan repayments by six months, and while the banks did announce a four-month extension for businesses still in financial distress, the Australian Banking Association (ABA) has now confirmed that businesses are starting to show signs of recovery.
According to the agency, small, medium and family businesses are starting to make their loan repayments again, with the value of SME loan repayments on deferral dropping by more than $686 million in June.
ABA chief executive Anna Bligh said the new figures showed small businesses were growing in confidence about Australia’s economic future, despite the Treasurer’s delivery of a grim economic outlook on Thursday.
“These figures show there are some green shoots emerging in our economy, and that’s a positive sign,” Ms Bligh said.
“There’s a very long road, and plenty of hurdles to clear, but it’s encouraging to see small, medium family businesses slowly regaining some confidence.”
According to the ABA, in total, banks have provided more than $258 billion in small-business loans.
Ms Bligh confirmed that the banks continue to work in partnership with the government and regulators to meet business needs.
“Banks are already showing they are prepared to lend to small and medium enterprises so they can get back on their feet. Our banks understand the key role they play in reopening our economy,” Ms Bligh said.
Earlier this week, the Treasurer announced that the Coronavirus SME Guarantee Scheme is being extended to 30 June next year to help SMEs move out of hibernation.
However, the scheme’s popularity has been questioned, with data showing that only 15,600 businesses have accessed loans worth a combined $1.5 billion compared to the scheme’s planned value of $40 billion.
