We all recognise the critical role that we, as small businesses, play in the Australian community…. employing over five million Australians that work for us .
Small business is the backbone of our AUSTRALIAN economy, with many of us hurting and facing a rapid evaporation of cash reserves – with sales starting to dry up.
The economic and social impacts caused by the coronavirus pandemic , potential lockdowns and the slowdown is significant.
In the face of such enormous disruption, our Government has released a relief package aimed at protecting the cash flows of small businesses ro help them to stay in business and continue to employ its people.
They plan to do this via the banks (managed by the ABA (Australia Bank Association) giving up to $100 billion in loans to SMEs eligible for the package and $10 billion in the hands of small businesses to help us stay in business.
The CEO of ABA , Anna Bligh, is a key player in this initiative, shared with us the key benefits of the package and how the banks are helping SMEs:-
Key benefits of the package
- The RBA backed a term funding facility for banks to support lower cost lending to small and medium businesses.
- Deferrals of loan repayments of principal and interest for up to 6 months for small businesses, including equipment finance leases and business credit cards.
- Fast tracked approval processes to enable small business to get access to these relief packages as soon as possible.
How the banks responded
- Business customers experiencing financial difficulty can defer principal and interest payments on a range of floating and variable rate loans, equipment leases and business credit cards.
- Banks are utilising the RBA rate cut and quantitative easing to allow them to cut rates on business lending.
- Many are providing even greater rate cuts for customers using digital banking products.
- Banks are also expected to put in place a fast track approval process so businesses suffering cash flow pressures receive the support they need – ASAP
These measures will provide small businesses with real cash retention measures that will assist them to stay operating through the crisis.
There are basic things you need to do to prepar to seek help and advice from your banking advisors on how to access the benefits of this package.
You will need to understand the specific terms of the benefit and take steps to position yourself and your business to be able to obtain maximum support on offer
Have a basic plan and cash flow forecast – normal vs current
setting up digital banking if you do not have it already
Communicating with your bank manager
This is where your accountant comes in handy – they will help you prepare .
Being nimble, innovative and opportune will be vital to managing the challenges you may be experiencing.
For us as a Nation to pull through – it is imperative for government, RBA, regulators and the private sector to work together.
Now is the time for Connection, Collaboration, Contribution and Community.
Would you be open to join me in a zoom meeting to Find out where to from here
Are you with me❓– here is a link to find out more
And we will be in contact to explorePosted on March 21, 2020