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Better Mortgage Management (BMM) national sales manager Murray Jones told Mortgage Business there are synergies between mortgage brokers and SME borrowers that make it a perfect market to tap into.
“Brokers are in the ideal situation to relate to these borrowers as they are small business people themselves and have faced a similar adjustment to their market environment post-GFC,” Mr Jones said.
“Brokers are becoming more comfortable with their obligations under NCCP and now understand that they can provide solutions to these SMEs while still being compliant with responsible lending criteria.”
Mr Murray’s comments come after Firstpoint director Troy Phillips flagged an opportunity for capital hungry lenders.
“The banks neglect the SMEs,” Mr Phillips said. “I think they have got to have a look at that lending space because someone is going to come in and take it all.”
BMM’s Murray Jones believes the lack of investment, product development and innovation in SME lending has left it open to new entrants.
“In terms of third-party or broker-introduced business, I don’ think the same amount of investment, product development or innovation is available for business lending compared to residential lending,” Mr Jones said.
“Therefore an opportunity definitely exists,” he said.
“Whether any new entrant can fund such lending at a competitive rate and return to them for the perceived higher risk associated with business lending is the question that they would have to ask themselves.”