Managing your business’ cashflow in these Covid-19 times

To our amazing Ecolease community

In the past couple of weeks we have been asked ​by a number of clients about the Government Guaranteed Small Business loans to help business with cashflow during this crisis (known as the SME Guarantee Scheme) .

In this COVID Bulletin we set out to explain how the government guaranteed loan works, how you can apply, and also offer other options that may work for your business at this time.

Remember, if you are considering using these options, it’s essential that you talk with your accountant and key stakeholders.

1. Government backed Loans for Businesses (SME Guarantee Scheme)

Under the Scheme, the Government is encouraging banks and other eligible lenders to support small businesses with unsecured loans.

Why is the government backing important?

It means that small business owners do not need to use their home or investment properties to secure funding for their business.

What are the key points?

  • SMEs with a turnover of up to $50 million will be eligible to receive these loans
  • Maximum loan is $250,000 per borrower
  • The loans will be up to three years, with an initial six month repayment holiday
  • Rate circa 4.5% p.a
How you apply?

The major banks have information on their websites and a hotline to call. They will require your financial statements and tax returns for 2018 and 2019, cash flows and other information.

You can call your bank direct or feel free to call ECOLEASE to walk through your options. One thing we can guarantee is that there is someone at the end of the phone!

2. Raising cash against property

Why would you consider this option?

The major benefit here is the flexibility that comes with mortgage backed loans and lines of credit. By extending the term for longer than 3 years there is less pressure on current and future cash flow.

How you apply?

You can call your bank direct or feel free to call David at Ecolease for assistance.

3. Unsecured loans/overdrafts and fintech options

Why would you consider these options?

There are a number of lenders that offer loans and overdrafts with less complicated application processes. You may consider these options if you don’t have completed financial statements.

Rates vary from 12.95% and upward for loans up to $250,000.

How you apply?

You can call your bank direct or feel free to call David at Ecolease for assistance.