Business lending expands broker horizons

Australia's SME lending market is changing, and brokers are playing an increasingly important role. Business demand for finance has risen sharply in recent years, and the funding landscape has diversified alongside it. As that market broadens, brokers have an opportunity to move beyond residential lending and help business-owning clients meet increasingly diverse funding needs, with the right lender relationships making all the difference.

What does RBA research say about broker activity in Australian SME lending?

Reserve Bank of Australia (RBA) research points to greater broker activity in SME lending in recent years, with lenders reporting that the share of loans originated and refinanced by brokers has risen. At the same time, specialist and non-bank lenders have continued to gain ground, particularly in smaller SME loans. The RBA has identified increased broker activity as one factor contributing to stronger competition in SME lending, alongside the growth of specialist non-bank lenders. Isaac Garson, lead business development manager at Bizcap, says this evolution is becoming apparent in his day-to-day conversations with brokers. 'More brokers are recognising that business lending can be a natural extension of the service they already provide,' Garson says.

Why is business lending considered a natural extension for mortgage brokers?

The existing client relationship is the foundation. Garson says brokers who have spent years helping clients with home loans or investment properties often discover those same clients also own businesses with entirely different funding needs. 'That existing relationship puts the broker in a strong position,' he says. 'They already understand the client, and commercial finance gives them another way to support them.' The RBA's research suggests brokers can play an important role in matching businesses with lenders able to provide finance. That role sits naturally alongside what brokers already do for residential clients. The transition does not require starting from scratch, it begins with a conversation the broker is already positioned to have.

How has the non-bank share of SME lending changed since 2022?

The RBA found that the non-bank share of SME lending increased strongly from the beginning of 2022, particularly for smaller loans. The RBA has also observed improvements in access to SME finance through faster approval times, streamlined applications and a broader range of funding products. Australian Bureau of Statistics (ABS) data from 2024–25 further shows the breadth of business demand: 18% of Australian businesses sought debt or equity finance that year, up from 5% in 2021–22. Among those seeking finance, 42% turned to finance companies, while 42% cited maintaining short-term cash flow or liquidity as a reason for seeking funding. The figures point to a market that is both growing and diversifying.

What different funding needs do SME borrowers typically have?

SME borrowers are not a single category. For Nathan Evans, senior business development manager at Bizcap, that variety is precisely what makes the broker's role valuable. 'There isn't one type of SME borrower and there isn't one funding solution that is right for every business,' Evans says. 'One client might need capital quickly to purchase stock, another might need some breathing room around cash flow, while another could be looking for funding to support expansion.' The RBA notes that fast decision times matter for SMEs needing to act on growth opportunities. At Bizcap, a global non-bank lender, eligible businesses can receive approvals in as little as three hours, with same-day funding available.

How can brokers demonstrate value when matching SME clients with lenders?

Understanding the client's scenario and knowing which lender to approach are the two skills that separate strong brokers. 'That's where brokers can really demonstrate their value,' Evans says. 'Understanding the scenario and knowing which lender to speak to can save a business owner a lot of time.' Traditional banks will continue to play an important role in SME finance. But as specialist lenders expand the options available and businesses become increasingly open to alternative forms of funding, understanding the broader market can become a valuable capability for brokers. A broader lending market gives brokers more tools with which to solve different client scenarios. The broker who knows the market well can move faster and help clients at moments that matter most.

How can brokers enter commercial lending without becoming product experts first?

Brokers accustomed to residential lending may find SME finance initially complex. Garson says this is where the relationship between a broker and their BDM becomes particularly important. 'A broker doesn't need to become an expert in every commercial lending product before they start having these conversations,' he says. 'A good BDM should be someone they can call, explain the client's situation to and work through the options with. Sometimes, the most important thing is simply recognising that there is a funding need and knowing who to ask.' Bizcap has funded more than 100,000 SMEs totalling $5 billion globally since its founding in 2019, and holds a 4.8/5 Trustpilot rating.

What questions should brokers ask business-owning clients to uncover funding needs?

Evans says the entry point can be straightforward. 'It can be as simple as asking a business-owning client what is happening in their business over the next six or 12 months. Are they hiring? Buying equipment? Taking on a new contract? Do they experience seasonal cash flow pressures? Those conversations can uncover needs that might otherwise never be discussed,' he says. The opportunity ultimately comes back to the strength of the client relationship. 'Brokers are already trusted to help clients make important financial decisions,' Garson says. 'If they can extend that relationship into the business as well, they have an opportunity to become an even more valuable financial partner to that client.' Brokers looking to build on these insights can explore more analysis in Australian Broker's premium reports. If this is useful to your network, share it on Facebook, Twitter or LinkedIn.

Featured experts

Isaac Garson: lead business development manager, Bizcap; specialises in broker partnerships and SME lending growth.

Nathan Evans: senior business development manager, Bizcap; focuses on matching SME borrowers with appropriate funding solutions.