City of Ballarat councillors unanimously approved the package at Wednesday night's council meeting which will see businesses receive a one-off $500 grant and community groups receive $250.

Businesses will be eligible for the grant if they have a payroll less than $1 million and can show evidence of a 30 per cent decrease in income for a period of four weeks since May 27, while community groups will have to demonstrate a negative financial impact in the same timeframe.

READ MORE: Applications open for $1 million council support grants

Ballarat's business leaders have praised the package which has been targeted at microbusinesses and community groups which had missed out on state and federal support.

Committee for Ballarat chief executive Michael Poulton said the relief showed council was prepared to share the burden of the pandemic.

"This is a great demonstration that council is serious about the 'we are all Ballarat' message. That's a message that we all stood on stage and really promoted really hard earlier in the year that this was something that was going to help substantially in our COVID recovery," he said.

"'We are all Ballarat' is about saying that it's not just big business or successful businesses or the the loud community groups or the large community groups, it's actually everybody in our community.

"If we want genuinely to be an inclusive community, which I think COVID has shown that we need to be, then it's these measures like how do we support small volunteer organisations that otherwise haven't got much support at all that really make a big difference."

Commerce Ballarat chair Hayley Coates said the business representative group was pleased to see council supporting local business.

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"It will provide a lot of support to your smaller microbusinesses who may have missed out on the bigger support packages from your state and federal governments," she said.

"It's great to see that councillors actually get it. They realise the difficulty that small businesses are going through, they can see that there is a gap in the funding that's been provided.

"As a member organisation, we have a number of members who are sole traders, very small businesses who may not have been eligible and we've been looking for ways for them to get support and this is somewhere that we can direct them to be able to get some level of assistance just to pay a bill or two."

Applications are currently open on council's website.

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