Powered by MOMENTUM MEDIA
subscribe to our newsletter

Murray highlights key SME lending issues

The Financial System Inquiry interim report has identified key issues in the lending processes for SMEs.

The report found that in some instances, lenders’ application processes can be overly cumbersome for SMEs.

“Business owners may not be directed to bank officers who are qualified to provide proper advice on business loan applications, or may be directed to personal loan products because some bank officers lack familiarity with business lending,” it said.

“In some cases, banks do not communicate to business owners why a loan application has been declined.”

The report found information asymmetries are the most significant structural factor contributing to the higher cost and lower availability of credit for SMEs and can be a barrier to SME lending.

Advertisement
Advertisement

PROMOTED CONTENT


The issue has led the SME Association of Australia (SMEA) to begin developing a peer-to-peer (P2P) lending platform.

SMEA chairman Craig West pointed to Westpac’s recent investment in P2P lender SocietyOne and said the SMEA is looking to develop a similar lender model for business owners.

“I have engaged a consultant to look at it for the SMEA to find out how it could work,” he said.

“We have got the network and we are designing a software system to match businesses up.”

Mr Craig expects the service to be available to the SME community in the next six months.

 

Murray highlights key SME lending issues
mortgagebusiness

Latest News

Preliminary ABS data has revealed that the value of residential construction work done has declined in the September quarter to its lowest l...

Westpac and its subsidiaries have reduced its owner-occupied and investment property fixed home loan rates, effective 24 November. ...

Defence Bank has appointed two new board directors and announced the retirement of long-term director Lieutenant Colonel Craig Madden. ...

FROM THE WEB

Join a group of highly informed brokers.

Broker Pulse, a community-driven knowledge base of lender performance Reveal exactly which lenders are making life easiest for brokers and their clients by taking this monthly survey and joining a group of highly informed brokers who leverage these insights every month.

JOIN NOW
podcast

LATEST PODCAST: Responsible Lending - what could lie ahead for lenders, brokers and borrowers?

Do you expect to see strong uptake of the HomeBuilder scheme?

Website Notifications

Get notifications in real-time for staying up to date with content that matters to you.