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The non-major has revealed a new product following its inclusion in the government’s Coronavirus SME Guarantee Scheme.
Heritage Bank has been revealed as an official participating lender in the government’s Coronavirus SME Guarantee Scheme, and has unveiled its latest loan product, created to meet the needs of the scheme.
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The bank’s SME Support Loan has been created specifically to meet the requirements of the SME loan scheme and assist small businesses in need of working capital amid the COVID-19 pandemic.
The scheme will see the government guarantee 50 per cent of all unsecured loans provided to eligible small and medium-sized enterprises (SMEs) with a turnover of less than $50 million, until 30 September 2020.
The Heritage Bank SME Support Loan, under the provisions of the government scheme, will provide eligible SMEs with an unsecured loan of up to $250,000 for a period of no more than three years, with no repayments required for the first six months.
Additionally, it is a requirement under the scheme that the loan be utilised by the SME for current and upcoming cash flow purposes, including working capital, liquidity and operating expenses.
The features of the new product are as follows:
- Unsecured business loan from $20,000 to $250,000 on terms of up to three years;
- No repayments for the first six months (with interest capitalised);
- Principal and interest repayments will apply after the first six months;
- No establishment or account-keeping fees; and
- Redraw capability, to allow borrowers to only pay interest on the drawn balance of the loan.
Applications from both new and existing customers must be approved and made unconditional by 30 September 2020.
The product will be made available to both new and existing business customers, according to Heritage Bank.
The bank’s CEO, Peter Lock, welcomed its inclusion as an official participant in the Coronavirus SME Guarantee Scheme.
“Heritage has always been a bank that specialises in meeting the needs of small businesses.
“Our Business Banking team is focused on the SME sector, so we understand how small businesses work and the challenges they face,” Mr Lock said.
“That’s why we’ve been so keen to offer this new SME Support Loan, which gives small businesses an extra option they can draw on to get through the cash flow issues that the COVID-19 has created.
“We want to help these smaller operators meet the challenges they now face and come out of our current situation in a good position to thrive in future,” he concluded.
To date, the government has made 34 offers to lenders wishing to participate in the scheme, including five non-bank lenders.
Currently, the following lenders are known to have finalised their participation in the scheme:
- Australian Mutual Bank
- Bank of Queensland
- Heritage Bank
- Judo Bank
- Liberty Financial
- Moula Money
- MyState Bank
- Prospa
- Regional Australia Bank
- The Capricornian
- Unity Bank
- Westpac
[Related: Non-banks appointed to SME guarantee scheme]
