Non-bank Lenders Across The Ditch Access Australian Government’s SME Guarantee Scheme

Prospa one of five non-bank lenders to receive access to Australian Government’s Scheme

• Enables Prospa to deliver funding for thousands of Australian small businesses
• Prospa urges New Zealand Government to include non-bank lenders in New Zealand Business Finance Guarantee Scheme

14 April 2020

Prospa, New Zealand’s small business lending specialist, is pleased to announce it has received access to the Australian Government’s Coronavirus SME Guarantee Scheme (“Scheme”) to help small businesses in Australia deal with the impact of COVID-19 over the next six months.

The Scheme provides selected lenders, including Prospa, with a government-backed guarantee of 50 per cent against the outstanding facility balance of eligible products.

The New Zealand Government announced its own New Zealand Business Finance Guarantee Scheme (“NZ Scheme”) in March, under which the Government guarantees 80 per cent of the risk and banks cover the remaining 20 per cent.

Both schemes are designed to support the flow of credit to small businesses considered by the lender as being viable in the longer term, however the NZ Scheme is only available to traditional banks and currently non-bank lenders are ineligible. The Australian Government’s Scheme leverages the ability of smaller, non-bank lenders to quickly distribute funding and create liquidity in the economy, promote competition to the banks, and secure financial inclusion for Australian small businesses.

Prospa has received an allocation of up to $223 million under the Australian Government’s Scheme, which can be applied to all eligible new lines of credit and loans issued by Prospa in Australia between 14 April 2020 and 30 September 2020.

Prospa urges NZ Government to work with non-bank lenders to distribute essential working capital

As Australia’s leading online lender to small business, Prospa is uniquely placed to implement the Australian Government’s initiative and stands ready to do the same in New Zealand.

Prospa is today urging the New Zealand Government to consider widening the NZ Scheme to include established non-bank lenders who can quickly distribute new loans to small businesses that have traditionally been unable to secure bank funding. By extending access to the NZ Scheme to non-bank lenders such as Prospa, the New Zealand Government could improve access to essential working capital for more small businesses facing cash flow challenges due to COVID-19.

Prospa has delivered over NZ$52 million in funding to more than 1,400 New Zealand small businesses to date and has over 10,000 distribution partners across Australia and New Zealand.

Adrienne Church, General Manager, Prospa New Zealand said:

“Access to the Australian government’s scheme will enable Prospa to support thousands of small businesses facing cash flow challenges and we want to be able to do the same for those New Zealand businesses doing it tough.

Greg Moshal, CEO of Prospa said:

“We strongly urge the New Zealand Government to enable lenders like Prospa to access the NZ Scheme alongside the banks.

The more access small businesses have to working capital, the better it is for the economy.”

About Prospa

• Prospa provides cash flow products and services that allow small businesses to prosper
• Prospa has originated over $1.4 billion in loans to date across Australia and New Zealand
• Prospa has served more than 27,0000 small business customers
• Prospa is a founding signatory of the AFIA Online Small Business Lender Code of Lending Practice
• Prospa has a Net Promoter Score in excess of +77 and is ranked #1 in the non-bank financial services provider category in Australia and New Zealand on independent review site TrustPilot
• In 2018 and 2019 Prospa won Australian Fintech Lender of the Year, and achieved a clean sweep of the MFAA Excellence awards in all five States

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