A Hong Kong government-guaranteed loan scheme to help small and medium-sized enterprises (SMEs) weather the Covid-19 pandemic saw repayment defaults surge six-fold to HK$2.46 billion (US$313 million) last year from 2021, with worse expected.

There were HK$970 million loans in default in the first two months of this year, almost two-fifths the total last year and more than double 2021’s HK$420 million, a Post review of government replies to the Legislative Council’s Finance Committee earlier this month found.

Borrowers have urged the government to extend the holiday period for repaying the principal sum of their loans, or many more companies could be in trouble.