Non-bank business lenders join SME Loan Guarantee Scheme

Small businesses impacted by the coronavirus may soon find it even easier to secure extra finance, following the government’s latest decision to involve non-bank lenders in its SME Loan Guarantee Scheme.
Under the SME Loan Guarantee Scheme, the federal government will guarantee half of all new three-year unsecured business loans of up to $250,000 issued by eligible lenders, between 14 April and 30 September. Borrowers will receive an initial six month repayment holiday, with interest capitalised.
Australian Small Business and Family Enterprise Ombudsman, Kate Carnell, said the move should help small businesses get their hands on working capital loans quicker than they would with the big four banks.
“The inclusion of five non-bank lenders in the scheme, means there is a greater chance of credit flowing to viable small businesses that need it,” Carnell said.
“Non-bank lenders are accustomed to lending unsecured and getting funding to SMEs quickly.”
The first wave of fintechs chosen for the scheme are: Prospa, OnDeck, Moula, GetCapital, and Liberty Financial.
Carnell expressed support for the selected fintechs who have also signed up to the Fintech Code of Conduct, “as this commits them to provide a process of complaints-handling and transparency around loan rates”.
“It’s encouraging that four of the chosen non-bank lenders are signatories to the Code - Prospa, Moula, Get Capital and On Deck Capital,” she said.
From May 1, Spotcap will also be offering unsecured business loans under the scheme.
RELATED ARTICLE: Guide to Australia’s coronavirus financial support for small businesses
“It’s important the selected fintechs pass on the lower rates for loans under this scheme to small businesses, as they are backed by a 50% government guarantee,” Carnell said.
“Essentially this means the government is taking on half of the risk of the loan and that needs to be reflected in loan pricing.”
Prospa has already said it will adopt such an approach. CEO Greg Moshal told the Australian Financial Review that although the fintech would keep its risk-based pricing model, interest rates would be reduced to take into account the government guarantee.
“Obviously there is increased risk in this environment… but we’ve been able to decrease our pricing as a result of the scheme.”
Under the scheme, Prospa will be allocated up to $223 million to assist with its small business lending.
RELATED ARTICLE: ABS data reveals extent of COVID-19 financial hit to Australian businesses
Facing financial hardship amid COVID-19? For more support options, check out our guide on the government and various banks’ coronavirus financial relief packages for small businesses.
Or if you’re in need of a working capital boost to keep your business afloat, get started with some of the business loans below.
Business loans 2020
Business+ Unsecured Loan
Borrow up to $50,000 without using your assets as security. A fixed interest rate means your repayments don’t change over the life of the loan. Apply in minutes with Business+ online or the Business+ app. Get your money fast and efficiently. $20k minimum loan amount.
Interest Rate
Upfront Fee
Funding speed
Rates range from 11.95% p.a. to 22.95% p.a.$495VariesBusiness+ Unsecured Loan
Borrow up to $50,000 without using your assets as security. A fixed interest rate means your repayments don’t change over the life of the loan. Apply in minutes with Business+ online or the Business+ app. Get your money fast and efficiently. $20k minimum loan amount.
- Interest Rate
- Rates range from 11.95% p.a. to 22.95% p.a.
- Upfront Fee
- $495
- Ongoing Fees
- $20 per month
- Late payment fee
- $0.00
- Transaction fee
- -
- Early repayment penalty
- Early Payout Costs apply during fixed rate period.
- Other fees
- -
- Loan type
- Loan
- Security type
- Unsecured
- Minimum loan amount
- $20,000
- Maximum loan amount
- $50,000
- Minimum loan term
- 1 year
- Maximum loan term
- 3 years
- Repayment frequency
- Fortnightly, Monthly
- Repayment types
- Principal & Interest
- Minimum trading period
- 1 year
- Minimum annual turnover
- $75,000
- Application speed
- Varies
- Approval speed
- Varies
- Funding speed
- Varies
- Extra repayments allowed
- yes
- Redraw allowed
- no
- Other benefits
- -
- Other restrictions
- -
Read reviews and learn more about Great Southern Bank business loans
Prospa Plus Business Loan
Prospa uses risk-based pricing to determine your interest rate. They look at factors including your industry, years in business, cash flow, creditworthiness and the overall financial health of your business.
Interest Rate
Upfront Fee
Funding speed
Interest rates vary based on risk.3.5%from 24 hoursProspa Plus Business Loan
Prospa uses risk-based pricing to determine your interest rate. They look at factors including your industry, years in business, cash flow, creditworthiness and the overall financial health of your business.
- Interest Rate
- Interest rates vary based on risk.
- Upfront Fee
- 3.5%
- Ongoing Fees
- $0.00
- Late payment fee
- $0.00
- Transaction fee
- -
- Early repayment penalty
- $0.00
- Other fees
- -
- Loan type
- Loan
- Security type
- Secured
- Minimum loan amount
- $150,000
- Maximum loan amount
- $500,000
- Minimum loan term
- 3 months
- Maximum loan term
- 3 years
- Repayment frequency
- Weekly
- Repayment types
- Principal & Interest
- Minimum trading period
- 3 years
- Minimum annual turnover
- $1,000,000
- Application speed
- 10 Minutes
- Approval speed
- Same-day approval
- Funding speed
- from 24 hours
- Extra repayments allowed
- yes
- Redraw allowed
- no
- Other benefits
- -
- Other restrictions
- -
Boost Business Loan
Whether you’re looking for a quick cash boost for your business or are ready to invest in growth, ScotPac offers a range of unsecured and secured loans from $10,000 up to $500,000. For loan terms of 6 months to 3 years. No application or account keeping fees to pay. Funds available in 24 hours or less once approved. Repayment options available.
Interest Rate
Upfront Fee
Funding speed
On applicationDetails on applicationFrom 24 hoursBoost Business Loan
Whether you’re looking for a quick cash boost for your business or are ready to invest in growth, ScotPac offers a range of unsecured and secured loans from $10,000 up to $500,000. For loan terms of 6 months to 3 years. No application or account keeping fees to pay. Funds available in 24 hours or less once approved. Repayment options available.
- Interest Rate
- On application
- Upfront Fee
- Details on application
- Ongoing Fees
- $0
- Late payment fee
- -
- Transaction fee
- -
- Early repayment penalty
- -
- Other fees
- -
- Loan type
- Loan
- Security type
- Secured or Unsecured
- Minimum loan amount
- $10,000
- Maximum loan amount
- $500,000
- Minimum loan term
- 6 months
- Maximum loan term
- 3 years
- Repayment frequency
- Weekly
- Repayment types
- -
- Minimum trading period
- 1 year
- Minimum annual turnover
- $120,000
- Application speed
- From 24 hours
- Approval speed
- From 24 hours
- Funding speed
- From 24 hours
- Extra repayments allowed
- -
- Redraw allowed
- -
- Other benefits
- All industries supported.
- Other restrictions
- Loans up to $100K: No upfront collateral required Loans between $100K to $200K: Borrower must be a property owner Loans over $200K: Borrower must be a property owner, and the loan will be secured
Unsecured Business Loan
Business Loans from $5,000 to $5,000,000 with high approval rates. Access to funds on loans up to $500,000 in as little as 3 hours. Cash flow friendly repayments and open minded offers.
Interest Rate
Upfront Fee
Funding speed
On Application3%, starting at $399from 3 hoursUnsecured Business Loan
Business Loans from $5,000 to $5,000,000 with high approval rates. Access to funds on loans up to $500,000 in as little as 3 hours. Cash flow friendly repayments and open minded offers.
- Interest Rate
- On Application
- Upfront Fee
- 3%, starting at $399
- Ongoing Fees
- no
- Late payment fee
- $50.00
- Transaction fee
- -
- Early repayment penalty
- no
- Other fees
- -
- Loan type
- Loan
- Security type
- Unsecured
- Minimum loan amount
- $5,000
- Maximum loan amount
- $5,000,000
- Minimum loan term
- 3 months
- Maximum loan term
- 1 year
- Repayment frequency
- Weekly, flexible
- Repayment types
- Principal & Interest
- Minimum trading period
- 4 months
- Minimum annual turnover
- $144,000
- Application speed
- 10 Minutes
- Approval speed
- within 1 hour
- Funding speed
- from 3 hours
- Extra repayments allowed
- yes
- Redraw allowed
- no
- Other benefits
- Daily repayments available.
- Other restrictions
- Fast Business Loans for amounts up to $500,000 are funded in 3 hours, Small Business Loans can take 24 hours.
Business+ Vehicle Loan
No upfront deposit and no extra security. Fixed rate for the life of the loan giving you cash flow certainty. Quick quotes and apply online in 20 minutes. Balloon payment available. Can be used for new and second-hand vehicles up to five years old that are bought from a dealership.
Interest Rate
Upfront Fee
Funding speed
Rates range from 6.29% p.a. to 16.99% p.a.$0VariesBusiness+ Vehicle Loan
No upfront deposit and no extra security. Fixed rate for the life of the loan giving you cash flow certainty. Quick quotes and apply online in 20 minutes. Balloon payment available. Can be used for new and second-hand vehicles up to five years old that are bought from a dealership.
- Interest Rate
- Rates range from 6.29% p.a. to 16.99% p.a.
- Upfront Fee
- $0
- Ongoing Fees
- $8 per month
- Late payment fee
- $22.00
- Transaction fee
- -
- Early repayment penalty
- Early Payout Costs apply during fixed rate period.
- Other fees
- $100 security administration fee
- Loan type
- Loan
- Security type
- Secured
- Minimum loan amount
- $10,000
- Maximum loan amount
- $250,000
- Minimum loan term
- 1 year
- Maximum loan term
- 7 years
- Repayment frequency
- Monthly
- Repayment types
- Principal & Interest
- Minimum trading period
- 1 year
- Minimum annual turnover
- $75,000
- Application speed
- Varies
- Approval speed
- Varies
- Funding speed
- Varies
- Extra repayments allowed
- no
- Redraw allowed
- no
- Other benefits
- $0 Establishment fee (usually $595) for applications made before 28 February 2025.
- Other restrictions
- -
Read reviews and learn more about Great Southern Bank business loans
Mozo provides general product information. We don't consider your personal objectives, financial situation or needs and we aren't recommending any specific product to you. You should make your own decision after reading the PDS or offer documentation, or seeking independent advice.
While we pride ourselves on covering a wide range of products, we don't cover every product in the market. If you decide to apply for a product through our website, you will be dealing directly with the provider of that product and not with Mozo.