Small businesses in Australia can breathe a sigh of relief following a new agreement between the four largest banks which brings a new set of regulations to small business loans. The agreement follows legislation against unfair terms in contracts and protects business owners from cruel changes and penalties that would have otherwise been subject to the whims of the banks. The new changes take effect for loans below $3million, which is ten times higher than the previous protection threshold of $300,000 and should bring new confidence and stability to an entire sector of the economy.
- The big four banks have agreed to all new small business contracts. That should open up new opportunities for the small business owner.
- It was a ground breaking agreement for processing contracts now offered. Small business owners could expect to write contracts that will be fulfilled.
- Trust the big four banks to make the right decision for small business owners. That could give them the upper hand in a competitive marketplace worldwide.
“COSBOA notes that banks can no longer call in a default for an unspecified negative change in circumstances of a small business customer. In addition, banks are now able to vary contracts only in specific circumstances.”