Govt to provide $100k interest-free loans to businesses

The Government will provide interest-free loans to of up to $100,000 to small businesses grappling with the impacts of Covid-19, after banks failed to meet the Government's expectations.

The loans are available for a year and will be offered to businesses with 50 or less full-time equivalent staff.

In a statement, Finance Minister Grant Robertson appeared to be disappointed in banks' lending to help businesses impacted by Covid-19.

"It has become clear that the support that is available to our small and medium businesses from banks is not meeting their needs nor our expectations as a Government," he said.

The scheme will provide $10,000 to every firm and in addition $1800 per equivalent full-time employee.

The loans are only interest-free if they are paid back within a year, Robertson said.

Grant Robertson. Photo: Getty Images
Grant Robertson. Photo: Getty Images

After that, the interest rate will be 3% for a maximum term of five years. Repayments are not required for the first two years, he confirmed.

 

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