Small Business Loans

    Covid -19 - Small Business Cashflow (Loan) Scheme (SBCS)

    The Government announced a Small Business Cashflow Scheme (SBCS) to support businesses struggling because of loss of actual forecast revenue as a result of Covid-19. The scheme is administered by the IRD.

    The businesses must have 50 or fewer full time equivalent employees. 

    Applications are open from 12 May 2020 to 12 June 2020 inclusive.

    The annual interest rate will be 3% beginning from the date of the loan being provided. Interest will not be charged if the loan is fully paid back within one year.

    Eligible businesses are entitles to a one off loan. The maximum amount loaned is $10,000 plus $1,800 per full time equivalent employee. 

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    We note one of the eligibility criteria is your business must be viable. This means you must have a good reason to believe it is more likely than not the business will be able to pay its debts as they fall due within the next 18 months. You must keep any evidence of the businesses ongoing viability at the time of requesting the loan as IRD may audit your application. Evidence might include, a cashflow forecast for the short term, a plan for where revenue will come from in future market conditions and a forecast of those revenues , Financial Statements.

    The full terms and conditions of the Small Business Cashflow (Loan) Scheme can be found here. 

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    Please note: The above E-newsletter notes and the related articles on our website are of a general nature and therefore we urge clients who may be affected by these changes to contact us to discuss your specific circumstances before making any changes or drawing any conclusions.

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