The Australian banking system has decided to defer small business loan repayments for the next six months. This measure will free up $8 billion to support borrowers through the Coronavirus crisis. Cases involving hardship related to mortgage payments are also open to consideration by the banks.
Australian Banking Association chief executive Anna Bligh has given particular consideration to the exponentially increasing volume of calls banks are receiving from small businesses in distress and unable to meet payments.
With an incentive to tame increasing levels of unemployment and bankruptcies Anna Bligh has stated that banks’ deferral of principal and interest repayments on $100 billion of small business loans “could put as much as $8 billion back into the pockets of small businesses as they battle through these difficult times.”
Treasurer Josh Frydenberg has backed this measure taken by the ABA, stating that this move will boost confidence and solidify cohesion between the government and the Australian business community.
Among the banks that have agreed to participate in the ABA plan include:
- AMP Bank
- ANZ
- Bank Australia
- Bank of Queensland
- Bendigo and Adelaide Bank
- CBA
- HSBC
- Macquarie Bank
- Suncorp Bank; and
- Westpac
Source: Australian Banking Association, March 20, 2020, 12.00am