‘Tis the season to expand into SME finance

by Australian Broker23 Dec 2019

An SME lender has encouraged brokers looking to expand their business to diversify into commercial lending, particularly in the end of year period as demand for business finance ramps up.

According to OnDeck Australia, the holidays are the peak consumer spending period of the year – excepting home buyers. With consumers set to spend around $51 billion in the run up to Christmas, SMEs will face a variety of cash flow needs and challenges.

For mortgage brokers looking to fill the revenue gaps which occur over the quieter December and January weeks, SME finance could be the answer as demand for commercial loans gathers momentum.

Research from OnDeck shows that three out of five (58%) small businesses are negatively impacted by calendar events and public holidays such as Christmas, with one in ten (12%) report being ‘severely impacted’.

The problems can be the result of increased costs (17%), delays in debt payments (22%), delays in delivery of products (26%) and even loss of customers to competitors (6%).

Over half (59%) of small business owners agree having fast access to funds can help them prepare for major events such as the holiday season.

OnDeck CEO Cameron Poolman said, “SMEs that don’t have their finances ready to go to take advantage of opportunities when they arise, will miss out.”

Not only are time-poor business owners likely to need support organising finance, but OnDeck data shows one in four existing home loan clients may be SME owners.

“This provides a ready base for brokers to diversify their business at a time when many SMEs are actively seeking finance,” Poolman said.

By partnering with an SME lender such as OnDeck, brokers can meet SMEs’ need for fast, efficient access to funds, with loan approval often delivered in as little as one business day.

Further, OnDeck provides a variety of resources to support brokers moving into the commercial lending space.

“Our expanded BD team works closely with brokers who are new to SME lending. OnDeck also provides a partner portal giving brokers access to marketing advice and tools that include ‘ready to send’ eDM templates complete with the broker’s logo and brand colours,” said Poolman.