Business advocates have welcomed the news by the federal government of a third phase of the SME guarantee loan scheme.

The new SME Recovery Loan Scheme announced by Treasury today will provide longer-term loans with a repayment period of up to ten years and funding up to $5 million.

Businesses currently receiving JobKeeper payments will be eligible to apply.

The new loans are set to provide a lifeline to many small businesses as JobKeeper payments are set to taper out on March 28.

Advocates welcome third phase

Australian Banking Association chief executive Anna Bligh has described the loans as the “right product for the times”.

Bligh suggests the new government-backed loans will allow more businesses to get access to funding.

She told News.com:

“The new phase of the scheme will make more businesses eligible and allow banks to provide more funding and support to businesses, particularly those still doing it tough,”

Westpac CEO Peter King has welcomed the new loan scheme, saying it will

further help Australian small and medium sized businesses recover and grow.

“While many of our customers are back on track, some sectors and geographies remain under pressure. For those customers, the new scheme will provide targeted support and also helps provide a funding bridge to give businesses more time to recover.”