Small business owners have borrowed almost $116 million through the Government's Small Business Cashflow Loan Scheme since the Covid-19 lockdown started on August 17.
The Small Business Cashflow Loan Scheme (SBCLS) was launched in early May 2020 to help businesses struggling because of Covid-19. It's overseen by Inland Revenue.
An Inland Revenue spokeswoman told interest.co.nz 8,800 loan applications have been received since August 17, seeking total borrowings of $138.74 million. A total of 7,233 loans have been approved worth $115.75 million.
All up since the scheme launched, $2.025 billion in loan applications have been received from 126,801 would-be borrowers. A total of $1.848 billion has been loaned out to 114,373 borrowers.
Under the SBCLS, “viable” businesses can get unsecured, interest-free loans from the Government of up to $100,000 depending their size, comprising a $10,000 base loan plus $1800 for every full-time employee up to 50 employees.
The loans are interest free if they are repaid within two years. Thereafter an interest rate of 3% will be charged for a maximum term of five years, but repayments won’t be required for the first two years. If borrowers don't fully repay their loan within two years they'll be charged interest for the entire term of the loan.
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