Government Extends Small Business Lending Exemption to 2026

Initially introduced in April 2020 as a temporary measure to support SMEs during the COVID-19 pandemic, the exemption allows small businesses to obtain loans without being assessed under the standard RLOs, provided the credit is genuinely for business purposes. The exemption has been extended multiple times, with the latest extension providing an additional two years for data collection to inform future policy decisions.

Under this exemption, a small business is defined as one with fewer than 100 employees or an annual revenue of $5 million or less. The government emphasizes that this measure is designed to support small businesses in accessing the credit they need for growth and operational needs, such as hiring staff or upgrading facilities.

Assistant Treasurer and Minister for Financial Services, Stephen Jones, stated, "This means more businesses can access the credit they need, when they need it." Minister for Small Business, Julie Collins, added, "I know access to finance is a critical issue for small businesses, which is why this extension is so important."

While the extension is welcomed by many in the SME sector, it's crucial for business owners to approach borrowing responsibly. Ensuring that loans are used for genuine business purposes and that repayment plans are sustainable is essential to avoid potential financial pitfalls.

For more detailed information on the extension and its implications, refer to the official announcement by the Treasury Ministers.