Banks across Australia have been granted a bit over 15,000 repayment deferrals on home and business loans during the recent lockdowns taking place across the country.

Since Thursday 8^th July, over 600 business loans have been deferred, including 14,500 home loans, with NSW said to be the origin of a majority of hardship assistance requests, the Australian Banking Association has revealed.

Chief executive officer of the Australian Banking Association Anna Bligh, reminded customers not to tough it out on their own.

“Lockdowns continue to bite across several states, and banks are again stepping up to help. Support is available to all small businesses and home loan customers significantly impacted by current lockdowns or recovering from recent lockdowns, irrespective of geography or industry,” Chief executive officer of the Australian Banking Association Anna Bligh.

As of August 2021, hardship approvals and loan deferrals have been heavily skewed towards NSW residents, with the banks said to be reporting many calls for assistance in NSW coming from both business and families affected by the recent shutdowns.

NSW home loan deferrals account for more than two-thirds of total deferrals, while almost 80 percent of deferred business loans are also from NSW.

According to the Australian Banking Association (ABA), banks have dedicated hardship teams who stand ready to listen and consider a range of options that suit customers’ situation.

Given the lockdown situation in South East Queensland, banks stand ready to assist customers who need help. The sooner you talk to your bank, the sooner they can help you find a solution that is right for you,” says Anna Bligh.

Business support on offer:

• Up to three-month repayment deferrals, with loan terms extended accordingly.
• Offered to all small business customers (business lending less than $3 million and a turnover of less than $5 million), which includes up to 98% of small businesses.
• Only for loans in good standing (i.e. repayments up to date or engaged in a payment program with their bank).

During the peak of the covid-19 pandemic in 2020, almost 500,000 home loans and more than 225,000 business loans were deferred.

How Can Customers Access The Bank Support?

The ABA represents 22 banks, including the big four, major regional and mid-sized banks, as well as foreign institutions with a banking licence in Australia. 

CBA will be proactively contacting eligible businesses early next week to offer them a loan deferral through an online application process. 

“The pandemic continues to impact businesses across Australia, with small businesses in particular facing cash flow challenges as a result of the lockdowns and restrictions on travel,” said The Commonwealth Bank’s chief executive, Matt Comyn.

“We recognise that some small businesses, like those in the tourism, hospitality and retail industries, are where the effects of lockdowns are being most acutely felt.” 

Westpac chief executive Peter King said his bank was gearing up in anticipation of increasing requests for support. 

“We are seeing the need for immediate support for small business owners who are experiencing challenges with reduced trade, cashflow and foot traffic as more people stay at home, particularly in areas with lockdown restrictions like Greater Sydney,” he noted. 

“We have scaled up our support to reflect the longer impact of COVID-19 and have a dedicated team of bankers available to help tailor this assistance to our customers’ personal circumstances” said Westpac chief executive Peter King.