Australia’s response to the pandemic has allowed most loan holders to return to regular repayments, the nation’s peak banking body says.
Most loans placed in the deep freeze due to the coronavirus pandemic have resumed regular repayments, Australia’s peak banking body says.
As of March 31, only 0.5 percent of the almost 1 million loans that had been deferred due to COVID-19 hardship remained that way, the Australian Banking Association has revealed.
According to the ABA, just 3170 home loans and 508 small business loans are still on hold after industry-wide measures were brought in to assist households and firms at the peak of the economic downturn.
ABA chief executive Anna Bligh said the numbers were a positive reminder of how well Australia had shielded itself from the worst financial onslaught caused by the global pandemic.
“These figures reflect the impressive recovery Australia’s economy is experiencing after facing a one-in-100-year pandemic,” Ms. Bligh said.
“The fact that unemployment is lower than expected and the economy has rebounded faster than we anticipated is great news for the vast majority of homeowners and small businesses.”
At the height of the pandemic, Australia’s banking industry installed deferral periods of up to six months for mortgage and small business loan customers who had experienced financial hardship due to the nation’s first recession in 30 years.
The deferral period has ended, but banks are offering further support to customers and businesses still battling the effects of the virus.
“Banks will continue to support those households and businesses still doing it tough this year, taking a fair and compassionate approach to get people through the pandemic,” Ms. Bligh said.
Loan deferrals peaked last year in June, with 854,606 loans paused across the four central banks and Suncorp. According to the ABA, Victoria has the highest proportion of small businesses and mortgages still on deferral.