COVID-19 Australian Bank Assistance

Darren Stacey , National Leader, Finance Solutions
Executive Director, Debt Advisory
BDO Australia

Given the significant market disruptions now becoming apparent across the country, the major Australian banks have announced how they will assist their impacted business customers. While many individuals are rightly focussing on the health and wellbeing of their own family, the impacts on business and employment are often the next thing on their mind.

It is still too early to know how this crisis will unfold and how the impacts will be felt across the economy, but it is clear a number of sectors will face severe disruptions. We are already seeing the warning signs in tourism, transport, education, sporting, hospitality and entertainment. Unfortunately, many businesses in these sectors are likely to be pushed to the brink and some will fail. Failing businesses contribute to unemployment, loss of capital and broader impacts on the community.

Sometimes the difference between getting through the crisis or failure is engaging early with your key stakeholders, which includes your bank, creditors and the Australian Tax Office.

Most banks in Australia are offering a range of assistance. While all the banks have advised that tailored assistance will be considered on a case by case basis, the following table outlines the specific areas where the big banks are offering help.

Business Customers ANZ CBA NAB WBC BOQ Suncorp
Defer Payments Yes Up to 3 months Up to 3 months Up to 3 months Yes Yes
Extension of loan term Up to 3 months Up to 3 months
Restructuring & consolidating loans Case by case Case by case Case by case
Breaking term deposits without rate / fee impact Yes Yes Yes Yes Yes
Deferred Business Credit Card payments Yes Yes
Business financial counselling access Yes
Merchant terminal fee waivers Up to 3 months Up to 3 months
Interest Rate Relief Yes, by 0.25% No increases
Fee-free Redraw Yes
Additional bank staffing to process decisions Yes
Waiving fees / interest on temporary excesses Yes Yes
Working capital assistance Yes
Special arrangements regarding arrears Yes

Note: this list is current as at 16/03/20 based on each bank’s public announcements

In many cases, seeking assistance from your existing bank is normally a more sustainable solution (and less expensive) than seeking unsecured working capital loans. If you’re faced with uncertainty regarding your business cash flow and would like assistance to talk about the options for dealing with your finance requirements, we are here to help.

It may be the case that assistance from your bank is only part of the solution and other strategies may be required. We can help guide you by providing assistance in navigating these issues.

Source: BDO Australia        Tel: +61 2 9251 4100
Level 11, 1 Margaret St, Sydney NSW 2000  AUSTRALIA