IRD News

Government loans for struggling small businesses - applications open

Posted 12 May 2020

Applications are open today for the Government’s Small Business Cashflow scheme, making loans available to small businesses struggling with loss of revenue due to COVID-19.

Inland Revenue will administer the scheme, handling loan applications, and payment and repayments.

To be eligible for a loan, a business or organisation must have 50 or fewer full-time-equivalent employees and be eligible for the Wage Subsidy Scheme.  The business must also have a sound plan to be viable and ongoing, and it must hold information on file to verify this.

In most cases, businesses will be entitled to a loan amount of $10,000 plus $1,800 per full-time-equivalent employee, to a maximum of $100,000.

The loan has a five-year term and must be repaid by 31 July 2025.

Applications will be open up to and including 12 June 2020. Most successful applicants will receive funds within five working days.

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. Repayments are not compulsory in the first 24 months.

Businesses should speak with their financial advisors before applying.

Details about eligibility criteria and applying for the loan can be found at www.ird.govt.nz/covid-19.