Small Business Cashflow Loan update

The Government recently announced the following changes will be made to the Small Business Cashflow (Loan) Scheme:

  • Currently no interest is charged if the loan is repaid within one year. This will be increased to two years.
  • Currently the loan can only be used for core operating costs. This will be broadened so that the loan can be used, for example, on capital expenditure.

In addition, applications for the loan can now be made until 31 December 2023, an extension of three years.

These changes will be made by Inland Revenue unilaterally changing the terms and conditions of new and existing loan contracts. We don’t yet have a date when this will happen, but it will be by 31 December 2020.

  • At this stage, all other aspects of the loan scheme remain in place, including:
  • It is for businesses with 50 or fewer full-time-equivalent employees.
  • They must have been in business on 1 April 2020 and have experienced a 30% decline in revenue as a result of COVID-19 restrictions.
  • The maximum amount that can be borrowed is $10,000 plus $1,800 per full-time-equivalent employee and only one amount can be drawn down.
  • The loan period is for five years and interest rate is 3% from the date of the loan being provided.

The Government has asked for advice on some of these existing aspects of the loan scheme, so further changes may happen at a later stage.


Unfortunately, with details changing all the time and at such speed, we need to add that the above content is correct at the time of writing as far as the author is aware and is very much subject to change. We have, to the best of our ability, acknowledged any shared content. All related links provided to the corresponding websites are subject to change as they are live links.