Small Business Government Loans

Small business loans are available at the national, state and local council level for businesses that meet the government’s growth criteria. State-level grants are usually available for businesses that meet the State’s development agenda. This could be regional development, focus on a particular industry, job creation or to fund research in a particular subject.

Though rare, Federal guaranteed loans are available for businesses that meet the national growth requirements, especially during a financial crisis or emergency situations like the one we are facing now to help economy thrive. In this article, we will discuss about few loans for which, Government will provide a guarantee, and some others where the restrictions to avail loans has been eased.

Coronavirus SME Guarantee Scheme Phase 2

All active Australian businesses with turnover of less than $50 million in the previous financial year, or expected turnover of less than $50 million in the current financial year are eligible to apply for loans under the Scheme. Both self-employed individuals and non-profit businesses are eligible. Businesses that have accessed loans in Phase 1 can also apply for loans in Phase 2.

Eligible Candidates and investment avenues:

  • Both self-employed individuals and non-profit organizations are eligible to apply
  • Loans acquired can be used for a broad range of businesses purposes (including to support investment)
  • Loans can be both secured and unsecured
  • Lenders are allowed to take guarantees
  • Lenders are allowed to take any security is accepted, except for residential property


Loans acquired under this scheme cannot be used for

  • purchasing residential property
  • purchasing financial products
  • lending to an associated entity; or
  • leasing, renting, hiring, existing assets that are more than half way into life expectancy

Government Guarantee for Loans

Under the Scheme, the Government will provide a guarantee of 50 per cent to small and medium enterprise (SME) lenders for new unsecured loans to be used for working capital. This will enhance these lenders’ willingness and ability to provide credit, which will result in SMEs being able to access additional funding to help support them through the upcoming months SMEs with a turnover of up to $50 million will be eligible to receive these loans.

Quick and efficient access to loans for small businesses

The Federal Government is providing an exemption from responsible lending obligations for lenders providing credit to existing small business customers. This exemption is for 6 months, and applies to any credit for business purposes, including:

  • fresh loans
  • loan limit increases
  • loan variations and restructures

These lending obligations do not currently apply to lending which is mostly for a business purpose, but it can take time and effort for lenders to be satisfied that the money borrowed meets this test. By providing a temporary exemption from responsible lending obligations, this reform will help small businesses get access to loans quickly and efficiently.

The above mentioned are only a few of the government loan arrangements and assistance programs available to SMEs. To know more about such programs, please speak to one of our advisors at the number mentioned below.

Enquiry Form