Repayments resume on almost half of deferred small business loans
According to new data from the ABA, repayments have resumed on at least 82,000 small and medium business loans, in what has been deemed a good sign for the economy.
The Australian Banking Association (ABA) has revealed that two in five small and medium business loans that had been deferred are now being repaid again.
This compares to 45 per cent of all deferred mortgages that are back to making regular loan repayments.
“This is a good sign for the economy. It shows that more Australians are getting back on their feet and resuming their loan repayments,” said ABA chief executive Anna Bligh.
Australian banks provided a loan repayment deferral to around one in 11 Australian mortgage holders and one in eight small business owners so they had some breathing space during the worst of the COVID-19 pandemic.
“These loan deferrals have helped hundreds of thousands of Australian families and small businesses survive the pandemic,” Ms Bligh said.
In just the past month, as many customers came to the end of their six-month deferral, more than 130,000 mortgages and 50,000 SME loans had had their repayments resumed.
According to the data from Australia’s seven largest banks, the total number of deferred loans has dropped to 439,000.
“Right now, it’s really important that people contact their bank to figure out the path ahead. The earlier you speak to your bank, the more options they have to help you find a way through,” Ms Bligh said.
“Banks will work with customers to figure out a tailor-made solution. That might include restructuring a loan, or in some cases, granting an additional four-month deferral.
“If you are in financial difficulty, please call your bank, they can help you find a way through. Don’t tough it out on your own.”