From the 12th of March 2020, businesses have been able to apply for the “Small Business Cash-flow Scheme” or “SCBS” loans directly from Inland Revenue. Inland Revenue will accept loan applications from 12 May to 12 June. Applications can only be made by the taxpayer through MyIR.

Realistically, the amounts of these loans are too low to be of any material benefit. However, for businesses that are struggling to get funding from their bank or are looking for a small amount to carry them through until regular trading resumes, then it may be worth pursuing one of these loans to provide some immediate cash flow relief.

If you want to apply for one of these loans, then we can assist you. However, we cannot make the application on your behalf, but we can help step you through the process.

The application process itself is relatively easy, especially, if you have already applied for the wage subsidy as the IRD pulls through the employee data to determine the value of the loan.

An important note is that each taxpayer can only make one application. Therefore, we recommend that you apply for the maximum that you are eligible for (which is the default position in the applications).

How much can a business get:
$10,000 per business, plus $1,800 per full-time equivalent employee, up to a maximum of $100,000.

What are the benefits:

  • The loan is unsecured; and
  • No repayments are required in the first 24 months; and
  • The interest rate is set at 3%, but the loan is interest-free if the loan is repaid within 12 months; and
  • This will be a relatively fast way for small businesses to gain access to a small amount of cash
    to assist with cashflow.

What are the disadvantages:

  • The amount of the loans is very modest – too small to have any real impact for smaller businesses; and
  • A well-respected commentator has publicly suggested that obtaining one of these loans might impact the willingness of banks to provide further finance; and 
  • A business needs to have a NZBN to apply.  All companies will have this, but most other entities will not.  It is a frustrating process to apply for a NZBN.


  • The business has received, or would have been eligible for, the Wage Subsidy (i.e. 30% turnover drop in a month between January and June 2020); and 
  • The business has less than 50 FTE employees.  The definitions of full time and part time uses the same criteria as the Wage Subsidy scheme.  I.e. fulltime is 20 hours or more and part time is less than 20 hours; and
  • The business concludes on reasonable grounds that it is viable at the time of making the application.

Here is the Inland Revenue’s position about what needs to be done to conclude a business is viable:

“Your business must be viable

To be eligible for the SBCS loan your business or organisation needs to be viable and you must have a plan to ensure it remains viable. This generally means the directors or owners have good reason to believe it is more likely than not the business or organisation will be able to pay its debts as they fall due within the next 18 months. Your accountant may be able to provide this advice.

You must keep any evidence of the business or organisation’s ongoing viability at the time of requesting the loan, as we may audit your application.

Evidence might include, for example:

  • A cash-flow forecast for the business or organisation for the short term.
  • A plan for where revenue will come from in future market conditions, and a forecast of those revenues.
  • Financial statements showing the business or organisation has enough resources to sustain itself when including the SBCS loan.
  • Your accountant’s assessment that the business or organisation is viable and ongoing.”

Per the Inland Revenue, to apply for a loan a business will have to do, or declare, the following:

  • Provide your New Zealand Business Number (NZBN) – businesses and organisations without an NZBN will need to obtain one before applying for the loan.  
  • Confirm your business or organisation is experiencing a minimum 30% decline in actual or predicted revenue from Jan 2020 to June 2020 as defined in the wage subsidy scheme.
  • Confirm your business or organisation existed before 1 April 2020.
  • Confirm your business or organisation is viable and ongoing, you have a plan to ensure it remains viable and ongoing, and you are keeping evidence we can use to check this.
  • Confirm you’ll use the loan to pay for core operating costs (including, but not limited to, rent, insurance, utilities, supplier payments, or rates).
  • Confirm the loan will not be passed through to the shareholders or owners of the business or organisation, for example, by a dividend or a loan to the shareholders or owners.
  • Confirm you have the appropriate authority to commit your business or organisation to this loan.
  • Confirm you are 18 years or over and have the legal right to apply for this loan.
  • Confirm you are aware we are not providing financial or other advice regarding this loan.
  • Agree to the loan terms.

If you have not yet applied for the wage subsidy, you’ll also need to provide your number of full-time and part-time employees.

Here is a link to the terms and conditions of these loans:

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