Room for optimism despite flat business credit growth

by Adam Smith16 Jul 2014
Business credit demand has remained flat for the quarter, but an industry leader has claimed Australia's overall business outlook is still positive.

The Veda Quarterly Business Credit Demand Index found that applications for business loans, trade credit and asset finance grew only 0.5% for the June quarter versus the same period last year. While trade credit applications and business loans saw rises of 0.3% and 4.9%, respectively, they were offset by a sharp decline in asset finance. Asset finance applications fell 4.9% for the quarter.

In spite of the flat result, Veda generaal manager of commercial credit Moses Samaha said there was room for optimism.

“While overall conditions are flat, it’s important to put these results in the context of a boom in business credit demand in the June quarter 2013, where business loan demand grew almost 10% and asset finance by approximately 6%," he said.

In light of this, Samaha said business outlook remained positive despite only a moderate rise.