The New Zealand government has announced some changes to the eligibility criteria for the Small Business Cashflow (Loan) Scheme (SBCS). 

The Government has announced some changes to the eligibility criteria for the Small Business Cashflow (Loan) Scheme (SBCS). These changes align the eligibility criteria with the Government’s recent decision to extend the application period for the scheme until the end of 2023.

These changes will take place from early February 2021. In the meantime, the current eligibility criteria will remain in effect and businesses can continue to apply for the loan using the existing criteria.

“We want to keep viable businesses afloat where we can.”

Revenue Minister David Parker

The main changes to SBCS include:

  • Businesses established after 1 April 2020, which have existed for six months, will now be eligible for a loan if they meet other eligibility criteria;
  • Firms can draw down a second loan, if they still meet eligibility criteria and have repaid the original loan in full;
  • Enable borrowing for investment in new equipment and digital infrastructure. Previously, SBCS should only be used for business operating costs.

A summary of proposed SBCS loan criteria

Application close31-Dec-2023
Loan amount$10,000+$1800 per full-time equivalent employee (FTE*), with a maximum of $100,000.
Sole traders can receive a loan of up to $11,800.
Business may apply for the loan more than once.
*Work out the number of FTEs using the calculator here.
Interest rateNo interest if repaid within the first 24 months;
3% per year after 24 months.
Maximum term5 years.
LimitationThe loan should be used for core business operating cost and investment in new equipment and digital infrastructure.
Eligibility1. The business must have no more than 50 FTE staff.
2. The business has existed for at least 6 months.
3. The businesses can demonstrate an actual drop in revenue of at least 30% because of COVID-19, over any 14-day period in the previous six months, compared with the same 14-day period a year ago. If the applicant was not in business a year ago, the 14-day period can be compared with the same or similar period in the previous month.
4. The business must be viable.

Last updated on 18 Dec 2020.

What does “viable” mean?

A business is viable means that it is more likely than not that the business will be able to pay its debts as they fall due within the next 18 months.

An evidence of the business’s ongoing viability will be required when apply the loan. Acceptable evidence could include:

  • a cash-flow forecast,
  • a forecast of future revenues,
  • financial statements, or
  • your accountant’s assessment.

How do I apply?

Eligible businesses should log in to myIR through the Inland Revenue website, then select “apply for a Small Business loan” to create an online application.

More information is available here.

Got a question?

Contact one of our business advisory team by emailing or simply call 09 281 8885 to discuss your situation today!