Lending to SMEs boosted by $2.2bn in June
Lending to small, medium and family businesses increased by more than $2.2 billion last month, the ABA has revealed, hinting at growth in economic confidence.
New figures from the Australian Banking Association have backed Treasurer Josh Frydenberg’s observation that there is early evidence of increased economic investment in Australia.
Continued lending to small businesses through June has seen loans boosted by $2.2 billion, the ABA has revealed, with CEO Anna Bligh attributing the increase to “green shots” emerging in the economy.
In total, banks have provided more than $258 billion in small business loans, helping to ensure the flow of new credit into the economy at a time it needs it most, Ms Bligh said.
“These figures show there are some green shoots emerging in our economy and that’s a positive sign,” she said.
“There’s a very long road, and plenty of hurdles to clear, but it’s encouraging to see small, medium family businesses slowly regaining some confidence.”
In a further sign that small, medium and family businesses are beginning to feel more confident about their financial future, they are starting to make their loan repayments again, with the value of SME loan repayments on deferral dropping by more than $686 million in June.
Ms Bligh said Australia’s banks continue to work in partnership with the government and regulators to provide business, and all customers, the confidence they need to see us through these challenging times.
“Banks are already showing they are prepared to lend to small and medium enterprises so they can get back on their feet,” she said.
“Our banks understand the key role they play in re-opening our economy.”
Last week, the government announced an extension of the Coronavirus SME Guarantee Scheme to support small and medium-sized businesses by increasing their access to funding to enable them to adapt and innovate during the coronavirus crisis.
Under the existing scheme, some 15,600 businesses have accepted loans worth $1.5 billion. However, given initial predictions that the scheme will deliver $40 billion to SMEs, the government has now decided to extend and expand the scheme to get more money into SME pockets.