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SME Recovery Loan Scheme: how it could help your business

5-minute read

Find out about the Federal Government’s SME Recovery Loan Scheme, eligibility criteria and how a SME Recovery Loan may be able to help your business recover and grow.

 

Key take-outs

  • Businesses that have received (or entitled to receive) JobKeeper payments between 4 January and 31 March 2021 or have been adversely economically affected by the March 2021 floods1 can now apply for loans under the government’s SME Recovery Loan Scheme.
  • Loans can be used for a wide range of business purposes, including business assets, working capital, purchasing commercial property and acquiring another business.
  • Repayment deferral periods of up to 12 months are available, with these being extended up to 24 months in certain circumstances.3

 

 

What is the SME Recovery Loan Scheme?

The SME Recovery Loan Scheme is designed to help small and medium sized enterprises (SME) that have been significantly impacted by COVID-19 or the recent floods.1

 

The Scheme is specifically available to businesses that have:

  • Received (or entitled to receive) a JobKeeper payment between 4 January 2021 and 28 March 2021; or
  • Been adversely economically affected by the floods in March 2021 and are located or operate in the relevant Local Government Areas (LGA).1

 

Loans can be used to refinance existing debt2, purchase commercial property and other business purposes that supports the growth and recovery of your business. 

Benefits of the SME Recovery Loan Scheme

  • Repayment deferral periods of up to 12 months are available, with these being extended to 24 months in certain circumstances.3 
  • Loan term of up to 10 years.
  • Loans can be used for a wide range of business purposes including refinancing existing loans.2

What can SME Recovery Loans be used for?

Loans issued under the Scheme can be used to refinance existing loans or for a broad range of business purposes including:

  • business assets
  • working capital
  • commercial property
  • acquiring another business.

 

Loans cannot be used to: 

  • purchase residential property;
  • purchase financial products;
  • lend to an associated entity; or
  • lease, rent, hire or hire purchase existing assets that are more than half way into their effective life.

What Westpac loans are available under the Scheme?

A Westpac Business Loan is available under the SME Recovery Loan Scheme.

 

A Business Loan can be used for a wide range of business purposes including refinancing an existing loan, buying a new business or commercial property.

 

Learn more about your options with Westpac under the SME Recovery Loan Scheme.

What are the SME Recovery Loan Scheme interest rates with Westpac?

Variable interest rates are available with rates depending on the security offered4 and whether a repayment deferral applies.3

 

Find out more about interest rates for Westpac loans under the SME Recovery Loan Scheme. 

When will the SME Recovery Loan Scheme start?

The SME Recovery Loan Scheme is available now until 31 December 2021. 

Is my business eligible?

Businesses (including sole traders and not-for-profits) are eligible if they have:

  • Received (or entitled to receive) a JobKeeper payment between 4 January 2021 and 28 March 2021; or
  • Been adversely economically affected by the floods in March 2021 and be located or operate in the relevant Local Government Areas (LGA).1

 

Your business must also meet the below eligibility criteria:

  • Have an annual turnover of less than $250 million
  • Have a valid ABN
  • Be trading for more than 12 months
  • Be a tax resident of Australia – that is based, registered and operating in Australia.

If I had a loan under the SME Guarantee Scheme Phase 1 or 2, can I apply for a SME Recovery Loan as well?

Yes, eligible borrowers can apply for up to $5 million in total, in addition to the SME Guarantee Scheme Phase 1 and Phase 2 loan limits.

How do I apply for a loan under the SME Recovery Loan Scheme with Westpac?

You can check your eligibility and enquire about a SME Recovery Loan with Westpac here. Loans are available to both new and existing Westpac customers.

How does the Westpac loan application process work?

Before you apply: Gather documentation about your business’s financial situation.

 

Make an enquiry: Once you’ve enquired, a Business Lending Specialist will be in touch with you to talk through the next steps. If you’re an existing Westpac customer with a Relationship Manager, we’ll pass on your details and they’ll contact you directly.

 

We assess your application: Please be aware that COVID-19 has impacted the time it takes to process and follow up applications but we’ll aim to contact you as soon as possible.

 

We have an enquiry form to assist businesses with the application process.

Can I apply for a repayment deferral?

Yes, Westpac is offering repayment deferrals of 6 or 12 months on loans under the SME Recovery Loan Scheme.3

My business isn’t eligible, are there any other support options?

If your business isn’t eligible for the SME Recovery Loan Scheme, we have other business finance solutions that may suit your business needs. 

 

If you’re experiencing financial difficulties, we may be able to provide a tailored solution to help you get the support you need.

Read more

How to apply for a loan under the SME Recovery Loan Scheme

We’ve broken down the requirements for a Westpac Business Loan under the SME Recovery Loan Scheme and the steps you can take to apply.

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Things you should know

This article is a general overview and should be used as a guide only. We recommend that you seek independent professional advice about your specific circumstances before acting. Product and feature details available under the SME Recovery Loan Scheme will vary by provider.

 

1. Adversely economically affected by the floods in March 2021 and who are located or operated in a flood affected Local Government Area (LGA) as published by the Commonwealth on the Scheme’s Treasury website.  

 

2. Restrictions apply as to existing debt that can be refinanced. Existing debt that is secured by residential property or that is 30 days or more in arrears may not be eligible. 

 

3. An interest rate premium may apply where a payment deferral period is selected. Interest will accrue during the period of the repayment deferral.

 

4. Security supporting these loans excludes residential property.