COVID-19 and Small Business

Starting a business? It’s possible to thrive with the right idea and funding

Bill Tsouvalas
Written by Bill Tsouvalas

What does the Walt Disney Company, General Electric and Microsoft have in common? They were all founded during a depression. Mega-successful Electronic Arts started right as the entire video game industry crashed at the end of 1982.

Unemployment is edging towards 10% and billions have been wiped from the ASX because of Victoria’s continued shutdown. Nevertheless, there are still opportunities to start your own business.

With a growing population, government incentives and record low interest rates, this may be a good time to get your business off the ground.

Business funding is still plentiful

According to an article in small business portal Flying Solo, 60% of would-be entrepreneurs say they don’t launch their business due to access to money.

In July 2019, the Australian Banking Code of Practice was simplified, making it easier for businesses to secure funding without  the over the top paperwork and conditions  such as high minimum turnover or length of operation.

The Federal Government introduced a business loan guarantee scheme in response to COVID-19. They will guarantee unsecured loans up to $250,000 for three-year terms with a six-month repayment “holiday.” This jumps to a maximum of $1 million loans over five years in which the lender may choose to exercise the repayment deferral or not.

Savvy CEO and business finance expert Bill Tsouvalas said if you have faith in your business and a good plan for cash flow, there’s never been a lower barrier to entry.

“Right now interest rates are as low as they’re possibly going to get,” he said. “What’s more, the RBA will fix the 0.25% interest rate for $90 billion in loans with a special emergency lending facility.

“Buying equipment with chattel mortgages are cash flow neutral solutions, as you can finance more than the value of the asset. Unsecured loans tip the balance of power into the borrower’s favour. You can also take on massive tax incentives such as the instant asset write-off and the usual interest, depreciation and GST deductions.”

Support for business in troubling times

Until 31st December 2020, Australian businesses can instantly write-off $150,000 in business purchases.

Eligible businesses will also be allowed to deduct the cost of depreciating assets at an accelerated rate which is available over the 2019-20 and 2020-21 financial years.

The Government has also provided an exemption from responsible lending obligations for lenders providing credit to existing small business customers. This includes new credit, credit limit increases restructures and variations.

State and Territory Governments are also supporting business with cash grants and other incentives. Here’s a full round-up of them here:

Find support in brokers and industry associations

Consulting with a business finance broker can help you find unsecured and secured finance for your business.

“Developing a beneficial relationship with a broker can help you through the initial start-up phase and into growth and beyond,” Tsouvalas said. “They’ll help you find competitive rates and lenders deferring payments for example.”

Industry associations can also be a wealth of information and resources for starting a business.

Australian Government Business Portal is a goldmine of information and links to industry support, grants, and other incentives. Click here for more information.

The advice in this article is general in nature – contact a financial adviser to see what is right for you.


“The opinions expressed by BizWitty Contributors are their own, not those of BizCover and should not be relied upon in place of appropriate professional advice. Please read our full disclaimer."

About the author

Bill Tsouvalas

Bill Tsouvalas

Bill Tsouvalas is CEO and founder of Savvy. Bill founded Savvy in 2010 with an aim to connect Australians with competitive loans using the latest in technology. He has over 15 years of experience in finance, fintech, and economics. He is a patron of Kids Under Cover.