Banks announce "deferral" of loan repayments for up to 6 months

Banks defer small business loan repayments for 6 months

Australia's banks have announced that small businesses who are affected by COVID-19 will be eligible to have their loan repayments (principal & interest and interest only) "deferred" for six months, starting Monday 23 March 2020. At the end of the deferral period, small businesses are not required to pay any lump sum as a catch-up payment; it is a clear six month deferral.

We note that a "small business entity" is one which carries on a business with less than $10 million aggregated turnover, and can be an individual, partnership, company or trust that runs the business.

According to Australian Banking Association (ABA), this concession will be adopted by all Australian banks. The ABA confirmed that banks are putting in place a fast-tracked approval process, to ensure customers receive support as soon as possible.

The deferral option is available to any small business regardless of industry. Any small businesses who have not already been contacted by their bank should contact their bank to apply.

Banks have also announced various concessions for home loan customers

It is important to note that each Bank has announced different measures to support their customers whose job or earning capacity has been impacted as a result of COVID-19.

Some home loan customers experiencing financial hardship will be able to pause their home loan repayments for periods ranging from three or up to six months.

Some banks have announced they will reduce loan repayments to the minimum required under their loan contracts from 1 May.

As each bank has announced different details, we recommend you contact your bank and enquire what your options are.

< Older Post

Newer Post >

Audit Lowe Down – What are contract assets and contract liabilities that arise under the revenue accounting standards?

August 12, 2025

What are contract assets and contract liabilities that arise under the revenue accounting standards? Deferred revenue, accrued revenue, revenue received in advance, contract assets, contract costs asset, contract liabilities and receivables are all line items we see in the balance sheet in relation to revenue. It can be confusing to understand what these terms mean and whether different words are being used for the same thing. We have provided a guidance to these and similar terms to enable you to use them confidently and understand their meaning in a balance sheet.

Practice Update – August 2025

August 6, 2025

Paid parental leave changes have now commenced As from 1 July 2025, the amount of Paid Parental Leave available to families increased to 24 weeks, and the amount of Paid Parental Leave that parents can take off at the same time has also increased from two weeks to four weeks. Superannuation will now also be paid on Government Paid Parental Leave from 1 July 2025, at the new super guarantee rate of 12%, paid as a contribution to their nominated superannuation fund. Parents will also benefit from an increase in the weekly payment rate of Paid Parental Leave, increasing from $915.80 to $948.10 (in line with the increase to the National Minimum wage). This means a total increase of $775.20 over the 24-week entitlement.

Audit Lowe Down – Contracts often include price variations relating to bonuses / penalties / rebates – why do we need to consider these early?

July 28, 2025

Contracts often include price variations relating to bonuses / penalties / rebates – why do we need to consider these early? Many revenue streams are covered by AASB 15 Revenue from Contracts with Customers. The core principle of this standard is ‘that an entity shall recognise revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services.’ [emphasis added]. To determine what we expect to receive, all elements of the contract that are not fixed need to be reviewed. We need to review contracts for: Volume discounts Rebates Refunds Performance bonuses Penalties Price concessions Once we have identified variable consideration then we need to estimate the amount expected to be received using either: the expected amount using a probability weighted average of the likely outcomes or the most likely outcome. The method chosen is the one deemed to be the best estimate of the expected consideration, and the amounts may be updated at each reporting date. Once the consideration has been determined, the entity recognises only the revenue that is highly probable will occur – this is known as the constraint on revenue recognition. Practically, the requirements discussed above for variable consideration are relevant only where an entity satisfies the requirements for revenue recognition over time and contract crosses a reporting date. As the estimate of the variable consideration changes, there may need to be a catch-up adjustment on previous revenue recognition for that contract.