Powered by MOMENTUM MEDIA
subscribe to our newsletter
Murray highlights key SME lending issues

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.

Advertisement
Advertisement

“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.

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

The federal opposition has released its response to the final report of the banking royal commission, agreeing to 75 of the 76 recommendatio...

A class action suit has been filed against the major bank for allegedly approving home loans outside serviceability. ...

In its update on the implementation of Commissioner Hayne’s recommendations, the corporate regulator has hinted that it is investigating...

FROM THE WEB

POST RC PANEL DISCUSSION ADDED

podcast

LATEST PODCAST: The current mindset of the mortgage industry

Is enough being done to ensure responsible lending?