Coronavirus SME Guarantee Scheme Phase 2

Phase 2 of the SME Guarantee Scheme closed for loans on 30 June 2021

The Coronavirus Small and Medium Enterprises (SME) Guarantee Scheme Phase 2 provided SMEs (including sole traders and not-for-profits) with vital additional funding to help them get through the impact of Coronavirus, recover and invest for the future. Under the Scheme, the Government provided a 50 per cent guarantee to participating lenders to enhance their ability to extend credit to SMEs.

Phase 2 of the Scheme supported secured and unsecured loans for up to $1 million for terms of up to 5 years with a cap on interest rates. Phase 2 of the Scheme commenced on 1 October 2020 and ceased for loans on 30 June 2021.

Interest rates were capped at 10 per cent for fixed rate loans. For variable rate loans the cap is 10 per cent plus an amount calculated using the Bank Bill Swap Bid Rate. The Scheme Rules [PDF 594KB] have more information on how interest rate caps rates are calculated. Rules for interest rates varied between schemes. In the first instance check the details of your loan agreement as well as the relevant scheme rules.