Capping the rate on Coronavirus SME loans makes no sense at all.

Capping the rate on Coronavirus SME loans makes no sense at all.

The Government will cap the rate of interest lenders can charge on loans under the Coronavirus SME Guarantee Scheme (SMEG) noting that the move “will prevent interest rate gouging”. Talk about throwing the baby out with the bath water! SMEG has been ineffective in allowing quick access to funding for small businesses that don’t have […]

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The Government is barking up the wrong tree with SME loan scheme “enhancements”

The Government is barking up the wrong tree with SME loan scheme “enhancements”

After three months, just 4 per cent of the $40b available under this scheme has found its way into the hands of SMEs. Recognising this the Government has decided on three enhancements. 1. The term of guaranteed loans can be increased from three to five years. 2. SMEs can now borrow up to $1m from […]

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The Commonwealth should buy Judo Bank.

The Commonwealth should buy Judo Bank.

As a nation we cannot continue to rely on privately owned banks to achieve public outcomes like supporting the vital SME sector. When push comes to shove, banks will always act in the best interests of their shareholders – and so they should. What we need is a government owned SME bank that can improve […]

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The COVID-19 economic crisis shows we need a better way to fund  SMEs.

The COVID-19 economic crisis shows we need a better way to fund SMEs.

Many small business owners are already in dire financial straits and sadly it will get worse when the life support provided by JobKeeper and bank forbearance is turned off in September. The Covid-19 economic crisis has highlighted deficiencies in the way SMEs are able to access debt finance primarily through the big four banks. This […]

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The $90b Term Funding Facility for SMEs is a litmus test for the big banks.

The $90b Term Funding Facility for SMEs is a litmus test for the big banks.

The TFF is a timely and essential initiative that could be the key to helping thousands of small businesses avoid bankruptcy. The Government is putting a huge amount a faith in the banks’ ability and willingness to step up to the plate. They can’t compel them to lend but by providing the TFF they have […]

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The Government must act now to avert the collapse of small businesses.

The Government must act now to avert the collapse of small businesses.

Tens of thousands of small businesses are facing imminent collapse as revenues tank and they run out of cash. Urgent action is required to avert the disastrous consequences which will follow. Sensible government intervention like travel bans should flatten the coronavirus curve but we need to also need to flatten the curve of small business […]

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Pricing transparency is the elephant in the room issue for non-bank SME lenders.

Pricing transparency is the elephant in the room issue for non-bank SME lenders.

Borrowing from a non-bank SME lender will cost more than borrowing from a bank and to be clear, so it should. Non-bank lenders have higher cost of funds, they take more risk and very often they don’t take hard assets as security which means if the borrower fails, they usually face a 100 per cent […]

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2020 looms as a watershed year for the big banks.

2020 looms as a watershed year for the big banks.

And after the astounding Royal Commission revelations, we thought it couldn’t get any worse for the big banks! Twelve months ago in my wrap up of the Royal Commission I concluded with the comment “2018 has been an “annus horribilus” for the big banks and 2019 is shaping up as being at least as challenging”. […]

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Is the Australian Business Securitisation Fund a real solution to the funding woes of SMEs or just another political stunt?

Is the Australian Business Securitisation Fund a real solution to the funding woes of SMEs or just another political stunt?

The last piece of legislation passed before the previous Morrison Government went to the polls was the Australian Business Securitisation Fund (ABSF) Bill which makes $2b available to SME lenders over the next four years to kick start the development of a market for securitised SME loans. Will the ABSF which is administered by the […]

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Prospa shows why small businesses need non-bank SME lenders but challenges still remain

Prospa shows why small businesses need non-bank SME lenders but challenges still remain

The continued impressive growth achieved by Prospa post last year’s aborted IPO coinciding with the fall out from the Banking Royal Commission highlights just how important non-bank lenders have become for the future of Australian small businesses. Prospa is the dominant player in the online small business lending sector and the first to IPO. The […]

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