The Federal Government has opened a $1 billion zero-interest loan program for Australian manufacturers and logistics operators caught in the global market disruption of the last 18 months. Applications opened on 20 April 2026, and the bank-administered window closes on 20 October 2026.
The Economic Resilience Program (ERP) is being administered by the National Reconstruction Fund Corporation (NRFC). This article sets out what the program is, who can qualify, and the legal and commercial issues applicants need to think about before signing up.
Key Takeaways
- $1 billion zero-interest loan program for Australian manufacturers and logistics operators.
- Two channels: bank-administered loans up to $5 million (turnover under $100 million), and NRFC-direct loans for larger borrowers.
- The bank-administered window is open for six months only, until 20 October 2026. Individual bank allocations may exhaust earlier.
- Eligibility turns on the applicant’s primary ANZSIC code and either (a) evidence of material market disruption or (b) a contribution to Australia’s sovereign industrial capabilities. General inflationary pressure is not enough.
- Zero-interest does not mean free. Standard bank fees, default interest, security, and personal guarantees still apply.
- The loan cannot be used to refinance existing debt.
- Existing facility covenants, cross-default risk, tax treatment, and corporate structure all need to be reviewed before drawdown.
What The Economic Resilience Program Actually Is
The ERP is a $1 billion sub-fund carved out of the Federal Government’s $15 billion National Reconstruction Fund. It provides zero-interest loans to Australian businesses operating in eligible manufacturing and logistics sectors that have been materially affected by global market disruption, including the 10% US tariff regime introduced in April 2025, the ongoing Iran/Middle East conflict, fuel price spikes, freight cost increases, and volatility in fertiliser and plastics input costs.
It is a loan program, not a grant. The interest rate is zero, but the principal must be repaid in full at maturity. Standard bank fees, default interest, and enforcement provisions still apply. Applicants who treat this as free money will be in for a bad surprise.
The program is delivered through two channels:
- Bank-administered loans for businesses with turnover under $100 million and loan amounts between $10,000 and $5 million. These are issued by participating banks (initially ANZ, Commonwealth Bank, NAB, Westpac, Bendigo Bank, and Bank of Queensland) using each bank’s own credit assessment, overlaid with NRFC eligibility criteria. The bank tranche is open for six months only, until 20 October 2026.
- NRFC-direct loans for businesses with turnover over $100 million or loan amounts above $5 million. These are issued directly by the NRFC on terms negotiated with the borrower.
Who Can Qualify
To qualify, an applicant must:
- Be an Australian entity with an active ABN, operating predominantly in Australia.
- Have its primary business activity in manufacturing or logistics. Eligibility is determined by reference to ANZSIC codes issued by the Australian Bureau of Statistics, and the majority of the applicant’s business activity must fall within an approved code.
- Have a primary ANZSIC code on the NRFC’s published eligible list. The list is anchored in Manufacturing Subdivisions 11 to 25 (food, beverages, textiles, wood, paper, printing, petroleum, chemicals, polymers and plastics, metals, machinery, transport equipment, and furniture). It also includes road freight (ANZSIC class 4610), rail freight, water freight (including stevedoring), warehousing, postal and courier services, fuel retailing, and petroleum and chemical wholesaling.
- Demonstrate either (a) material market disruption to its business, or (b) a contribution to Australia’s sovereign industrial capabilities. The first limb is the principal pathway. Acceptable evidence includes documentary evidence and customer attestations – supplier debt notices, quotes showing input price spikes, documented changes in trade terms, freight cost increases, and severe supply delays linked to current global events. General inflationary pressure is not enough.
- Be credit-worthy. The bank or NRFC must be satisfied that the loan can be repaid at maturity.
The full eligible ANZSIC list, an FAQ document, and the bank-administered loans customer guidance are all published at nrf.gov.au and are reviewed periodically. Applicants should check the live versions before applying.
Loan terms and cost
The interest rate is zero. The cost of the loan is not. Borrowers should expect:
- Establishment fees, monthly account-keeping fees, and (potentially) line fees.
- Default interest at the bank’s standard default rate if the borrower breaches.
- Security where the bank would normally take security on an equivalent commercial loan. Zero-interest does not mean unsecured.
- Standard SME or mid-corporate financial covenants, including reporting and change-of-control restrictions.
- Personal guarantees from directors, particularly for SME borrowers.
The loan cannot be used to refinance existing debt. Permitted uses are limited to defraying increased costs from input price spikes, recovering from supply chain disruption, and (for NRFC-direct loans) scaling production of products critical to national supply chains.
The Application Process
For the bank-administered tranche, the applicant confirms its primary ANZSIC code is on the eligible list, compiles an evidence pack on material market disruption, approaches an existing business banker at a participating bank (banks generally require the applicant to be an existing customer), and provides financial statements, supplier and customer evidence, and a cash flow forecast supporting two-year repayment. The bank then runs its credit assessment with the NRFC eligibility overlay and documents the loan on its standard facility documentation, modified for the zero-interest feature and ERP-specific conditions.
For the NRFC-direct tranche, the applicant submits an enquiry via nrf.gov.au or contacts erp@nrf.gov.au, the NRFC engages directly to scope the proposed loan, due diligence and Investment Committee approval follow, and the loan is documented by the NRFC’s in-house legal team as a bilateral concessional loan agreement.
Issues applicants Need to think about
The ERP is genuinely useful for eligible businesses, but it is not without legal and commercial complexity. The issues we are flagging with clients include:
Broader NRFC funding
The ERP is one of several sub-funds carved out of the $15 billion National Reconstruction Fund. The NRFC was established in September 2023 under the National Reconstruction Fund Corporation Act 2023 (Cth) and invests across seven priority areas: Renewables and Low Emission Technologies, Medical Science, Transport, Value-Add in Agriculture, Forestry and Fisheries, Value-Add in Resources, Defence Capability, and Enabling Capabilities. The ERP sits within Enabling Capabilities but operates under a separate Statement of Expectations issued by the responsible Ministers, giving it broader and faster eligibility than the standard NRFC mandate.
The ERP is one of several sub-funds carved out of the $15 billion National Reconstruction Fund. The NRFC was established in September 2023 under the National Reconstruction Fund Corporation Act 2023 (Cth) and invests across seven priority areas: Renewables and Low Emission Technologies, Medical Science, Transport, Value-Add in Agriculture, Forestry and Fisheries, Value-Add in Resources, Defence Capability, and Enabling Capabilities. The ERP sits within Enabling Capabilities but operates under a separate Statement of Expectations issued by the responsible Ministers, giving it broader and faster eligibility than the standard NRFC mandate.
Some Ideal Candidates
- Manufacturers in food, beverages, chemicals, polymers, metals, machinery, transport equipment, or furniture
- Road freight, rail freight, and water freight operators
- Stevedoring and warehousing businesses
- Fuel retailers and petroleum and chemical wholesalers
- Mid-market and SME businesses with two-year cash flow capacity to repay principal
- Applicants with documented evidence of material disruption from global market events
Our experience & services
KPA Lawyers acts for clients across manufacturing, logistics, food and beverage, and adjacent sectors. Our services in connection with the ERP include:
- Eligibility analysis, including ANZSIC classification review and corporate structuring advice on which entity in a group should borrow.
- Review of facility documentation for the bank-administered tranche, including covenants, security, default, and cross-default provisions.
- Review of NRFC-direct loan documentation, including security, AIP plan obligations, and reporting covenants.
- Personal guarantee advice for directors providing security.
- Review of existing facility documentation to identify covenants triggered by the new loan.
- Coordination with the client’s accountant and financial planner on tax, cash flow, and personal balance sheet implications.
Speak to the authors
The bank-administered window closes on 20 October 2026. Individual bank allocations may exhaust earlier. If you would like to discuss whether your business qualifies, how the program interacts with your existing finance arrangements, or any of the issues raised in this article, the authors are available to take your call.
