“By acting quickly, we can soften the impact of the coronavirus on small businesses across the country and the millions of Australians who depend on them for employment.
“We stand shoulder to shoulder with the Government, the Reserve Bank, and the wider business community to produce the most effective package of measures on a larger scale and implemented faster than ever before.
“Today’s announcement will mean that small businesses can access an unsecured business loan through the Commonwealth Bank for three years of up to $250,000 at historically low rates, given the Government’s support and the Reserve Bank’s term funding scheme announced last week.
“Interest rates on unsecured small business loans will be up to 500 bps lower than current rates. No interest will apply unless the loan is used, no repayments will be required for six months, and there will be no establishment or monthly account fees. Australian businesses with less than $50 million turnover are eligible.
“These new loans will be available from Monday with businesses able to lodge enquiries online. Our Business Banking teams around the country will be proactively contacting tens of thousands of customers to offer our support.”
Measures announced today are in addition to those announced by the Commonwealth Bank over the past two weeks. These include:
Business customer support
- Offering existing and new small business customers the ability to defer loan repayments for six months;
- Auto-enrolling 76,000 small business customers into loan repayment deferrals from 1 April, providing immediate support of $240 million;
- 100 bps interest rate reduction on all small business loans linked to the cash rate;
- Support available for businesses facing difficulty including waiving merchant fees, waiving redraw fees, waiving early redraw fees on business term deposit accounts, and deferring repayments on vehicle and equipment finance loans.
Retail customer support
- Offering existing and new home loan customers the ability to defer loan repayments for six months, providing up to $10 billion of support in total for customers with small business or home loans;
- 70 bps interest rate reduction for home loans with one, two and three year fixed terms to 2.29% – our lowest ever – and available to both new and existing owner-occupiers on principal and interest repayments;
- 60 bps interest rate increase on 12-month term deposits for personal customers to 1.70% p.a., which is 1.45% above the RBA’s official cash rate;
- Changes to home loan repayments which will release up to $3.6 billion in cash for Australian households over a twelve month period;
Mr Comyn said: “We stand ready to take additional steps to support small businesses, households, and the economy.”