Indigenous businesses will be eligible for a $100,000 loan/grant package and specialist advice through Indigenous Business Australia (IBA) thanks to a $50 million funding injection from the Federal Government.
The funding is part of a $123 million boost from the Federal Government as part of their assistance to the Indigenous sector during COVID-19, which Minister for Indigenous Australians, Ken Wyatt, announced earlier this month.
“This includes providing specialist advice to help businesses survive, adapt and recover, assistance to access the different business support packages available from Government, and new funding arrangements where there are gaps in the mainstream measures and a demonstrated need,” Minister Wyatt said.
Mainstream measures currently available to all businesses in Australia include JobKeeper payments for employees, tax-free cash flow boosts between $20,000 and $100,000 for eligible businesses and rent reductions for commercial tenants.
Minister Wyatt said IBA assistance would be available to all affected Indigenous businesses, regardless of whether they are IBA customers.
IBA told NIT businesses can apply for working capital assistance of up to $100,000 via a loan/grant package.
The package could include a grant of up to 50 percent of the package amount, up to a 36-month loan term with zero repayments for the first 12 months and preferential interest rates thereafter.
IBA said these loan/grant package applications would be assessed on a needs-basis and that all funding given by the Federal Government would be “deployed in supporting customers”.
As for the “specialist advice” to be given to First Nations businesses, IBA said this would include a “rapid impact assessment of business positioning, cash flow management and assistance to access available stimulus measures”.
Designed to build resilience, IBA said this package developed with the funding from the National Indigenous Australians Agency (NIAA) would bolster other relief measures IBA has already announced.
One such measure is IBA reducing interest rates for all home loan customers to 2.99 percent per annum for an initial six-month period, whether or not they are experiencing hardship due to COVID-19.
IBA is also allowing COVID-19 affected customers with business loans or equipment leases to apply for interest waivers and loan repayment deferrals for an initial four-month period.
“None of the major banks [have] waived interest—rather they have simply deferred it,” said an IBA spokesperson.
“IBA has made these concessions proactively in the interests of our customers—despite not having access to the low-cost funding from the Reserve Bank made available to banks.”
A spokesperson for NIAA said the agency supports IBA in assisting First Nations businesses during the COVID-19 pandemic as it has “relevant experience” in the Indigenous business sector.
“IBA has the reach, knowledge and infrastructure to rapidly deploy support to the sector as well as the relationships with other Indigenous providers and Indigenous communities to deliver this package,” the spokesperson said.
Alongside the IBA loan/grant package, NIAA is working with other organisations to understand the various impacts COVID-19 will have on Indigenous businesses and is taking a “flexible approach with grant arrangements to assist with financial sustainability”.
The spokesperson said organisations such as Supply Nation, Many Rivers, and the Wirra and Yarpa Indigenous Business and Employment Hubs are helping to support the $50 million package’s rollout across the country.
To find out more about IBA business support, visit: https://www.iba.gov.au/indigenous-business-australia-covid19-support/.
By Hannah Cross