The joint federal and Victorian government grant was only made available to businesses in municipalities directly hit by the fires.

Those in neighbouring shires, which were still blanketed in smoke and were left almost empty without tourists, missed out.

But federal Emergency Management Minister David Littleproud and Victorian Police and Emergency Services Minister Lisa Neville rectified that this week, extending the funding to four more council areas: Indigo, Mansfield and Wangaratta in the North East and Wellington in Gippsland.

The grants scheme has already receives 19,000 applications and paid out more than $191 million to businesses.

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While the addition of four council areas was welcomed by all, it also had many putting up their hands to take credit.

"We heard the need for these grants loud and clear," Ms Neville said.

"These devastating fires affected so many businesses and communities, whether they were directly impacted by flames or not.

"Small businesses are vital to local economies and communities and we're so pleased they have been making the most of these grants. With the program now extended let's see if we can help another thousand businesses."

Victorian Senator Jane Hume described the work as a "Liberal team effort", saying she, Benambra MP Bill Tilley and Eildon MP Cindy McLeish lobbied the Labor Victorian government.

"Small business has been hit hard by not only bushfires, but also the Coronavirus pandemic. These grants will assist recovery and see businesses back stronger on the other side of the pandemic," she said.

A day later, federal independent MP Helen Haines stood with mayors from the three councils that will benefit in her seat of Indi and said it came about because of their team effort.

She said she had been campaigning for the grants scheme to be extended since March and talks had been held between herself, mayors and the state and federal governments, plus councils made their case directly to the Bushfire Recovery Agency.

"It's been a very long wait," Dr Haines said.

"We heard at the Bushfire Royal Commission that this wait has been too long, that the exclusion of postcodes has been detrimental to communities."

Wangaratta mayor Dean Rees and council chief executive Brendan McGrath also travelled to Canberra to make their case directly to Peter Cosgrove, who is leading a national business bushfire recovery initiative.

Cr Rees apologised to Dr Haines for the "hammering" of phone calls as they all fought to be included.

"We've got a number of businesses that were greatly affected by the fire season, not that they were specifically burnt out, but they lost all their tourism and basically had to shut up shop," Cr Rees said.

"Some of those businesses probably won't open because it did take too long, however at council we're here to help them as well."

He said he hoped the grants would help to get others back on track.

Indigo mayor Jenny O'Connor said it was the best news since the beginning of this year.

"I was talking to business owners and one actually burst into tears when I told her about it," she said.

"This really means a lot to our small main street businesses - their margins are already very slim."

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