Banks and fintechs expect loan applications to skyrocket with expansion of SME loan collateral

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“It hasn’t been that important but we are very optimistic that there will be a pretty big pickup for the revised scheme, given that these are much more flexible conditions,” he said.

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Mr Healy said Judo plans to loan $ 250 million to $ 300 million under the program over the remaining three months.

“I wouldn’t say it’s a failure,” he said. “Version two [of the scheme] was a significant improvement over the first version and I think this third version is going to be received a lot more warmly by banks than the previous versions maybe.

Australia’s largest investment bank, NAB, has taken just $ 80 million in NAB business stimulus loans under the scheme.

Earlier this month, NAB chief executive Ross McEwan championed the bank’s adoption of the program and told the House of Representatives Standing Committee on Economics that many NAB clients had chose to extend their overdrafts rather than take out a new loan under the program.

“We have a lot of gears going through the economy,” he said. “It has been used by businesses that have been really hit hard by COVID, but a lot of customers haven’t been hit hard by COVID at all – a lot of them are thriving. “

Treasurer Josh Frydenberg said the expanded program would allow otherwise viable SMEs to access vital additional funding to weather the pandemic, recover and invest for the future.

“With millions of Australians still stranded, we must continue to adapt our response to ensure that businesses have every chance to recover from these bottlenecks,” he said. “This is why the Morrison government is expanding the Small Business Recovery Loan Program. “

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