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As Australia approaches the one-year mark of working around global coronavirus restrictions, small to medium enterprises (SMEs) are still finding it hard to access finance from the big banks. Further highlighting the historic barriers to entry for customers and the need for alternative, boutique sources of finance.
Banks are more cautious towards certain industries (i.e., hospitality and tourism) than others which can limit the ability of SMEs to restructure their business to thrive under social distancing restrictions. According to a recent Smart Money article, the Reserve Bank of Australia (RBA) has seen a decrease in lending to SMEs, “especially in sectors such as retail and tourism as well as to customers from other banks”. The lack of confidence in repayments deprives businesses within these devastated industries from investing in new facets of the business that will help them survive and thrive. A recent Mozo article captured the essence of this sentiment “over a quarter of SMEs see lack of available funding as their biggest barrier to innovate”. If an SME’s ability to enter a new market or consolidate an existing one is inhibited, then they will perpetuate their own cycle of finance application rejection unless more boutique lenders pick up the slack.
We want all industries to Grow!
Grow Finance is in the business of helping all SMEs in all industries realise their vision. Trade Financing ensures stock orders and inventory needs for your business run like clockwork and can be shipped instantly.
“Their personable and experienced team will work thoroughly to approve the right amount of funding relative to your requests.”
Funding is approved on the same day as the application because the Grow Finance team understands the importance of keeping up the momentum.
The big banks, the same old story.
As the banks continue to reject applications, some of the world’s biggest finance players such as American Express are ready to pounce on the local market where they can hike up the interest rates. In a recent Australian Financial Review article, Lonergan Research has “found one in four SMEs, as a direct result of JobKeeper ending, intend to borrow this year and on average just under $100,000”. The absence of banks to fill this void will not only leave an Amex sized hole in the market but further highlights the historical complications of the application process for many SMEs. Respondents in the research survey stated the application processes are “typically complex and lengthy” thus SMEs may have to approach a myriad of different lenders before they secure finance.If you are a property owner and have been an established business for 2 years, you may very well have your finance solution within two hours. Grow Finance’s speedy and hassle-free online application process is designed to negate the barriers to entry and provide flexible repayment options to avoid financial stress.