The Government has announced a Small Business Cashflow Loan Scheme, with applications open now until 12 June 2020 (at this stage).
How much can I borrow?
It allows a business with under 50 full time staff to apply for a loan of $10,000.00 plus $1,800.00 per employee up to a maximum of $100,000.00.
What are the conditions?
The loan is interest free if it is repaid in the first 12 months, otherwise interest at 3% is charge over the whole loan term (including the first 12 months) with a maximum loan term of 5 years.
Repayments are not compulsory in the first 24 months - after 24 months you will be required to make principal and interest payments.
How do I qualify?
To be eligible your business either needs to have applied for the wage subsidy or been able to i.e. you are able to show a drop in income of 30%
You must also be able to show that your business is viable and you have a plan to ensure it remains viable. That plan can include current financials or a cashflow forecast.
To apply go to www.ird.govt.nz
The loan is not secured against the business assets. If you have existing loans with a bank or other lender, you need to consider whether you have any obligations in those loan agreements which require consent to entering into other lending.
Any questions? Get in touch with our team and we’ll get you sorted.