Lender support for business owners

What is impressive right now, is how much support from the government is available to keep the economy going. $97billion is going to go a long way to keeping it alive. 
 

Another $90b billion from the RBA to give all lenders (not just the big 4) access to cheap capital to enable it to keep flowing AND so that interest rates for business lending stay low (or get lower). Remember last time (in the GFC), capital costs for lenders went through the roof and it was passed on to business borrowers, by the banks, as soon as they possibly could. This time it looks a bit different and regulators look like they’ve learnt lessons from the GFC as well.

The lenders are updating us daily on how they’re assisting, so we’ve summarised some of their key assistance packages below.

Broadly speaking, lenders seem to be more flexible for business owners; not just now with assistance packages, but  also with access to more capital for managing cashflow if needed. 

However, if you want to take up the assistance package that your bank is offering, we’d like you to consider a couple of things first:

  1. The deferral isn't a freebee: A ‘deferral’ of the loan repayment doesn’t mean that  the loan stops completely. Whilst you might not have to make any repayments for the period, the interest that you were due to pay, will instead be added on top of the loan each month. This is what lenders mean by ‘accruing’, ‘capitalising’ or ‘compounding’. So effectively, whilst you're not making any actual repayments, your loan will actually increase over the 3-6 month period.
  2. It is actually for hardship: Some lenders may want to understand how you’ve been impacted, before they provide assistance, particularly in writing.
  3. Maybe wait for now: Keep the powder dry at this stage. If you don’t need to take up an assistance package just yet, then save it if you can, until you do need it. There’s been nothing from the lenders yet to say you have to take it up right now; we expect we’ll see the offers available for quite a few months.

So if you do need to access an assistance package, please reach out to us via the link below and we’ll provide you with the most direct contact for the bank, as well as assist you with what the bank will need from you.

Anyway, here’s the highlights from each lender that we work with. This isn’t an exhaustive list from each lender (as some are quite wordy):


ANZ

  • Defer repayments for term loans, with interest capitalised for up to 6 months. 
  • Temporary Increase to overdraft facilities for 12 months. 

Auswide Bank

  • 1% reduction in interest rates for existing variable business loans
  • Freeze monthly account keeping fees for up to 6 months.
  • Defer loan repayments, with interest capitalised for up to 6 months. 
  • Switch from Principal & Interest repayments, to Interest Only repayments for up to 6 months.
  • Restructure loan repayments and pay a reduced monthly payment for up to 6 months. 

Bank of Queensland

  • Defer small business loan repayments for up to 6 months.

BankWest

  • 1% interest rate reduction for existing variable business loans
  • Defer loan repayments on vehicle and equipment loans for up to 6 months
  • Waive merchant terminal rental and minimum monthly service fees for 90 days for customers who have had a 20% or greater reduction in transactions. 
  • Waived establishment fees on Temporary Overdraft products.

CBA

  • Defer repayments on a variety of business loan and overdraft products for 90 days. 
  • Waive merchant terminal fees for impacted customers with CBA payment terminals, for 90 days
  • Waive establishment fees and excess interest on Temporary Excess products.
  • Defer repayments on vehicle and equipment finance loans

ING

  • Defer loan repayments for up to 6 months. 

Macquarie 

  • Defer loan repayments, with interest capitalised for up to 6 months. 
  • Restructure and review loan with restructuring fees waived. 

NAB

  • 1% interest rate reduction on variable small business loans
  • Defer business credit card repayments for up to 6 months (including a 3 month checkpoint). 
  • Defer ‘Principal and Interest’ repayments for up to 6 months on business loans,
  • Merchant Fee waivers for businesses that want to temporarily suspend trade for up to 6 months. 

Scottish Pacific 

  • Bespoke assistance available on a case-by-case basis

St George Bank

  • 1% interest rate reduction for some variable business loans
  • Defer principal & interest payments on business term loans for up to 6 months. 
  • Merchant terminal rental fee refunds for 3 months.
  • Restructuring and consolidation of loans. 

Suncorp

  • Defer principal & interest payments for small business loans with interest capitalised for up to 6 months. 
  • Convert principal and interest payments to interest only payments for up to 12 months. 
  • Refund of merchant rental and transaction fees for up to 6  months. 
  • Cash flow support to assist with immediate cash requirements

Westpac 

  • 1% interest rate reduction for some variable business loans
  • Defer small business loan repayments for up to 6 months. 
  • Merchant terminal rental fee refunds for up to 3 months. 
  • No establishment fees for equipment finance loans. 
  • Defer payments for business credit cards for a period of at least 3 months 

Please reach out to us via this link if you have any questions or queries on these packages, or wish to take them up.