What small business owners should know about the non-bank lending sector

Scottish Pacific - 03/10/2019

For better or worse, SMEs generally know what to expect when borrowing from one of big the banks but the same cannot be said about the ever increasing number of alternative lenders now keen to lend to small businesses. In this interview with Scottish Pacific we talk about what SMEs need to know when considering non-bank lenders.


"Once a big bank executive, theBankDoctor now helps SMEs

CPA Australia - 06/09/2017

CPA Australia's In The Black magazine reveals how theBankDoctor now leverages the knowledge and experience gained from a career as a bank executive to assist small business owners with the challenges of financing their business.


The role of Governments in funding small businesses

SmartCompany - 01/05/2017

Could you imagine your local council spending $50 million of ratepayers’ funds to become a 33% owner of a brand new bank?
Well, that’s just what happened recently in north west England where Warrington Borough Council has invested £ 30 million ($51.8 million) in Redwood Bank, a new challenger bank that will provide lending facilities to local SMEs. Could it happen here in Australia?


Change is overdue & the banks are on notice

theBankDoctor - 06/02/2017

This is the confronting title of a report into the adequacy of the law and practices governing financial lending to small businesses just released by Kate Carnell, the Australian Small Business and Family Enterprise Ombudsman. The report makes 15 recommendations designed to address gaps in the existing regulatory environment and with the practices of industry participants.
What do these recommendations actually mean for small business borrowers, how will the banks respond and will anything change anyway? Here’s theBankDoctor’s take .....


Why Australia should follow the US lead in transparency of SME online loans

SmartCompany - 10/11/2016

SMART Box is a new comparison tool developed by fintech lenders in the USA to help American SMEs make more informed decisions about the total cost of borrowing, as well as enable apples-with-apples comparisons between alternative providers. SMART Box represents a ready-made opportunity for the Australian online SME lenders to take an all important step forward in pricing transparency.


SMEs given extra protection under new contracts law

SmartCompany - 19/09/2016

For too long SMEs have felt compelled to sign “take it or leave it” contracts with larger suppliers like telcos, banks, insurance companies and retailers. But new laws will give SMEs legal redress from oppressive & unfair terms in standard form contracts offered by big suppliers.


Online SME Payday Lenders are alive & well

The Age - 22/08/2016

Its often not until they have repaid the loan that cash-strapped, time-poor and financially inexperienced borrowers finally work out how much they have actually paid in fees and charges to some online lenders that could be more accurately described as payday lenders to SMEs.
This article explains how online lenders that charge the most can also grow the quickest. We call on regulators and industry participants to do more to ensure SMEs are able to answer three simple yet critical questions:
· Is this the best product for my needs?
· How much is it really going to cost me?
· Could I get a better deal elsewhere?


Its not just at the Rio Olympics that Great Britain is leading Australia

SmartCompany - 17/08/2016

Australians love sporting analogies and here’s another one to consider. Great Britain is not only blowing Australia away in the medal tally at the Rio Olympics, they are also streets ahead when it comes to regulating for increased competition in the SME banking sector.

UK’s Competitions and Markets Authority (CMA) has just announced several measures to ensure that customers benefit from technological advances and that new entrants and smaller providers are able to compete more fairly with the big banks.


What does the restructure at NAB mean for SMEs?

SmartCompany - 25/07/2016

NAB's CEO Andrew Thorburn has just announced an organisational restructure and at the same time he sacked three of his nine person leadership team. NAB is determined to capitalise on its strength in the SME sector. This article explains what SMEs can expect from this restructure.


NAB enters online SME lending market but execution is the key

SmartCompany - 02/06/2016

NAB has entered the already crowded online SME lending market with a new product called QuickBiz loans. It has some attractive features such as an interest rate of 13.85% but based on a mystery shopping exercise we conducted it appears that execution will (again) be one of the biggest hurdles it will need to overcome.


Banking resource website aims to help SMEs but fintech is still the “elephant in the room”

SmartCompany - 18/05/2016

A new Small Business Finance website has just been launched by the Australian Bankers Association in conjunction with CPA Australia, The Council of Small Business in Australia & the NSW Business Chamber. The website contains useful information about how to deal with banks which is good for those customers lucky enough to still have a traditional banking relationship but SMEs who want to borrow less than $250k and are not in a position to offer property security tend to miss out.
Fortunately these business owners do now have a genuine alternative, its called fintech and it’s a shame the only reference in the website to this option is just one sentence which simply says “other sources of finance which you may want to consider for your business include venture capital, angel funding, crowd funding and peer to peer lending”.


The big banks will learn that the Customer is always right

SmartCompany - 09/05/2016

Politicians on both sides are calling out bad bank behaviour. Banks are acknowledging they need to do better. Can they be trusted to put the customer first or is a Royal Commission needed to reign them in? Whatever the answer, in the end the Customer is always right


Non-bank lenders making inroads in SME market but challenges remain

SmartCompany - 17/03/2016

Non-bank lenders are making inroads into the big four bank domination of the SME markets. One of the major attractions of non-bank lenders is they generally do not insist on real estate security. Other reasons why SMEs are finding non-bank lenders attractive include fewer loan conditions and covenants, the ability to talk to people and faster decision making.

These are encouraging trends for non-bank lenders, although they still face obstacles in making serious in-roads into the dominant market share of the big banks. High on this list of obstacles are inertia and awareness.


Should your business consider moving to a fixed interest rate?

SmartCompany - 24/02/2016

No-one ever got rich trying to pick the top or bottom of the market and this applies to interest rates too. Interest rates are at or must be near record lows so is it time to fix your rates and what is your Interest Rate Risk Management policy anyway?


Be prepared to pay more for your debt in 2016, especially if you are a property developer or investor.

Business Spectator - 08/02/2016

Although many pundits tell us that interest rates are likely to remain flat or possibly even fall further in the short term, borrowers particularly property developers and investors should prepare to pay more for their bank debt in 2016.

In this Business Spectator article we explain what is happening with banks and interest rates, how this might impact on you and, most importantly, what strategies are available for you to deal with this risk.


The murky business of political donations by the big banks

SmartCompany - 02/02/2016

Over the past 2 years the Big Four banks have donated over $1.3m to the LNP and ALP. Does it make good business and ethical sense for public companies like big banks to donate to political parties? In this article for SmartCompany we look at this contentious issue and pose several questions which the various stakeholders should be addressing.


The Fintech Frolic has only just begun

Business Spectator - 04/12/2015

As each week goes there seems to be another announcement of a fintech lender partnering with a bank, accounting software provider or some other big brother. Fintech CEOs are jostling to fill their dance cards so as not to miss out on the perfect match but there are dangers, too, in hooking up with the wrong partner. Only time will tell whether these arrangements lead to long happy marriages or messy divorces.


Why the small business lending market is changing

SmartCompany - 01/12/2015

The DFA 2015 Small & Medium Business Survey revealed some telling statistics about how and why the world of business banking is changing such as:
- 57% of all SME borrowing is for working capital.
- 65% of SMEs are dissatisfied with their bank.
- 75% of them would switch banks if they received a better proposal.
- Yet 60% of them have never changed banks.

There are a number of factors driving this change including how SMEs embrace technology and the advent of "fintech lenders".


Why we should clone America's Small Business Administration

BRW - 16/11/2015

For 62 years the Small Business Administration has been helping Americans get funding to grow their small business. The SBA is widely regarded and respected as the voice of American small business and it enjoys bipartisan support from both sides of politics.

There is much we in Australia can glean from the SBA experience and in this article in BRW we identify five learnings.


NAB Business Bank results raise more questions than answers

theBankDoctor's Newsletter - 29/10/2015

The business bank has always been the "engine room" of NAB. It has dominated this market segment for a number of decades. In this newsletter we look at key issues like market share, customer satisfaction, competition and credit quality which throw light on where the business bank is at, where it might be heading and what challenges it faces along the way.


SMEs let down by the Government & its response the Murray Inquiry

SmartCompany - 21/10/2015

Reaction to the Government's response to the Murray Inquiry's final report has generally been positive. But the 800,000 Australian small businesses that rely on external debt to run and grow their business are unlikely to be as enamoured particularly in relation to lack of attention given to a major frustration of small business owners being the difficulty in accessing funding to grow their business.

In this BRW article we explain how SMEs have been let down and we highlight a challenge for Malcolm Turnbull and his new Small Business Minister, Kelly O’Dwyer whose predecessor Bruce Billson was an active and passionate supporter of small business. Turnbull with his “top end of town” background and O’Dwyer with her lack of experience combined with the additional and even potentially conflicting role of Assistant Treasurer have the job in front of them to convince SMEs that this new government understands and is fully committed to supporting the sector.


Fintech lenders yet to gain traction with SMEs

BRW - 08/10/2015

Small business owners seem largely unaware of who fintech lenders are and what they do. Results from a survey conducted by banking research company East & Partners suggest fintech lenders need to sell their individual and collective stories better in order to ensure that this new form of SME finance achieves its undoubted potential.

There are already around 20 established fintech SME lenders operating in Australia including Moula, SpotCap, ThinCats, Waddle, GetCapital, Banjo, OnDeck, Kikka, Capify, Prospa, Lendex, MarketLend, InvoiceX, BidInvoice, LendingPost, Bigstone, FundX, Timelio and MaxFunding.

Fintech SME lending has arrived and is here to stay but how quickly and safely the industry and individual participants grow will depend very much on how they engage with the SME sector.

In this article published by BRW, we identify a number of steps fintech lenders could take to improve their standing within the SME sector.


Four tips to take control of your banking destiny

SmartCompany - 28/09/2015

A recent survey conducted by East & Partners for debtor financier Scottish Pacific revealed some surprising and concerning attitudes of SMEs to their banking arrangements. One of the most telling findings was that only one in five review their lending requirements on a regular basis and one in two have not reviewed their primary bank relationship for some years.

These businesses are missing out because generally you will get a better deal from periodically shopping around than simply trusting the bank will always do the right thing. The SMEs most at risk are the ones which have been with the same bank for a long time.

In this article published by SmartCompany we analyse the report and outline four steps to help small business owners take control of their banking arrangements.


Why Australia needs a small business borrowers' Bill of Rights

SmartCompany - 01/09/2015

American small business borrowers now have a Bill of Rights which will afford significant protection from predatory lenders. Small business owners in Australia also need and deserve such protection particularly from some of the new entrants in the largely unregulated marketplace lending.

In this article published by SmartCompany we call on Australian SME lenders and other stakeholders to follow the American approach and work together to establish and conform to a bill which protects the legitimate rights of small business borrowers.


The risks in lending via a P2P platform

BRW - 24/08/2015

With bank deposit rates at record lows, the returns on offer from lending via P2P platforms look very attractive. Many investors, including SMSFs, are chasing these returns which range from 5 per cent to 10 per cent but these are definitely not equivalent investments.

In this article published by BRW we outline six risks of backing personal or business loans through P2P platforms and point out what the different players are doing to mitigate them. We also highlight how different P2P models work from a borrowers perspective.


SME lenders fear for their reputation in unregulated industry

SmartCompany - 17/08/2015

In this SmartCompany article by Renee Thompson we explain to readers how lack of regulation and education in the burgeoning marketplace lending sector could see all participants tarred with the same brush as we've witnessed with payday lenders. We emphasise the important role marketplace lenders can play in assisting SMEs which might otherwise not be able to gain support from a traditional trading bank and point out that it would be more than unfortunate if the undoubted potential of marketplace lending to help SMEs was dashed by the unscrupulous conduct of a few. A key area of concern is the lack of transparency in relation to fees and this needs to be addressed by both regulators and the industry participants themselves.


How to turn your bank manager into a raving fan

BRW - 14/07/2015

Believe it or not, the relationship you have with your bank manager has a huge bearing on how the bank sees you and your business and what level of service your receive.

A bank manager who is a raving fan can do wonders for you but on the other hand if you get offside with them your business is never going to get the treatment it deserves. Over many years on both sides of the banking fence I have observed the behaviours of customers which turn bankers both on and off.

In this article just published by BRW I identify four do's and don'ts for turning your banker into a raving fan.


Why the regional banks are beating the big four in the fight for the SME dollar

SmartCompany - 27/05/2015

Small business owners continue to be the most disadvantaged sector when it comes to dealing with the banks. East & Partners latest Business Banking Index survey, which monitors business customer behaviour towards banks, found SMEs (turnover between $1m and $20m) scored their banks a miserly 13 (where 10 = low and 100 = high) whilst corporate and institutional clients rated their banks at 60 and 30 respectively.

The result for small businesses was the worst since 2006 which may not surprise but what is telling is the significant disparity between the big four and the regional banks. Bank of Queensland and St George consistently score above average with satisfaction rates in excess of 70 per cent compared to an average of 35 per cent for the big four banks.

In this SmartCompany article we explain why SMEs are seemingly more engaged with the smaller banks compared to some of the big four.


The first bank to partner with a fintech could dominate the unsecured SME lending market

BRW - 21/05/2015

In 5 years time, Fintechs will dominate the market for unsecured small business loans up to $250k. Collaboration between banks and fintechs will produce a better outcome for them and most importantly SMEs.

In this article in BRW we talk about how banks are dealing with the challenge of these disruptors and what the future of SME lending might look like.


Finance through Fintechs is fast but ask these questions first

BRW - 05/05/2015

Fintechs offer the prospect of a “quick yes” for small businesses which cannot get a loan from the bank but you need to go into these new arrangements with your eyes wide open otherwise you could be in for a rude surprise.


Seven mistakes SMEs make when dealing with their bank

The Age - 21/04/2015

Calling on 35 years experience on both side of the banking fence, theBankDoctor outlines the 7 biggest mistakes small businesses make when dealing with their bank.


Why SMEs have lost faith in their traditional advisors

SmartCompany - 16/04/2015

New research has some surprising findings about who small business owners turn to for advice and there’s some sobering findings here for the professionals who have historically seen themselves as the trusted business advisor.


Six things to consider before you tender your banking business

SmartCompany - 23/03/2015

In a fit of frustration a small business owner may tell the bank that they are going to tender their banking business but theBankDoctor recommends a cautious approach and recommends you ask six questions before deciding whether this is something you really should be doing.


Why Australia needs a First Business Grant scheme

SmartCompany - 12/02/2015

The banks only seem prepared to lend to existing small businesses where they can get property security, so how do would-be first time business owners get a start, especially if they don't have property security?


What could the Murray inquiry have done for SMEs?

SMH - 18/12/2014

Australia’s two million SMEs have good reason to feel let down by the Financial System Inquiry. Their plight was superficially addressed in a two page appendix to the 315 page final report. The report and subsequent debate has largely centered on bank capital and risk weighting of mortgages, the financial planning sector and self managed super funds. So what could the FSI have done for SMEs?


SMEs short changed by the Financial System Inquiry

SmartCompany - 08/12/2014

The Financial System Inquiry has delivered 44 recommendations for reform in its final report released yesterday but small to medium-sized businesses were largely ignored.


The fight NAB Business Bank has to have

AB+F - 11/11/2014

NAB’s Business Bank has some big problems but they are not due competition rather they are all self-inflicted.


Should our business have more than one bank?

eXPRESSO - 06/11/2014

A second bank can be a useful back up or a competitive alternative but it’s not an option for every business. Should you have a second bank?


The Village shows that NAB is no dinosaur

theBankDoctor - 03/11/2014

NAB shows creativity and innovation by establishing The Village. Located at Docklands, it provides a free place for NAB business customers to work and meet.


Its line in the sand time for NAB

theBankDoctor - 31/10/2014

None of NAB’s key stakeholders would be satisfied with the 2014 results and after ten years of underperformance it is time to draw a line in the sand on NAB.


PayPal and the banks

SmartCompany - 21/10/2014

theBankDoctor talks to SmartCompany about how a PayPal partnership with the banks could create more loan options for SMEs


The business relationship you should be reviewing

SmartCompany - 20/10/2014

It makes sound business sense to regularly review your banking relationship just as the bank regularly reviews your performance.


The Cameron Clyne Legacy & where to from here for NAB under Andrew Thorburn

theBankDoctor - 06/10/2014

What shape is NAB really in as Clyne prepares to handover to Andrew Thorburn and what is the Clyne legacy?


Alarm bells ring for businesses as banks face economic spot fires

SmartCompany - 29/09/2014

The alarm bells are starting to ring as further evidence emerges of significant concerns about the state of our economy. What does this mean for banks and particularly their business customers?


Literacy not database will help SME funding

AB+F - 29/09/2014

Improving the financial literacy of small businesses may be a better way to improve their access to bank financing than establishing a dedicated database as suggested in the Murray Inquiry Interim Report.


6 questions to ask before you decide to change banks

The Age - 10/09/2014

Before changing your business bank, there are certain issues you need to be clear about. theBankDoctor explains what these are.


theBankDoctor's submission to David Murray's Financial System Inquiry

theBankDoctor - 28/08/2014

On behalf of Australia’s two million SMEs, theBankDoctor has made this submission to the Inquiry about what should be done to improve access to funding to support their growth.


What does the Murray report have for SMEs?

Sydney Morning Herald - 21/07/2014

theBankDoctor talks to SMH about what the Murray Inquiry could do to help Australian SMEs gain improved access to funding.


What does the Murray Report have to say about the SME banking sector?

SmartCompany - 17/07/2014

theBankDoctor analyses the Interim Report from the Financial System Inquiry and explains why the FSI will find it hard to bring about real changes to assist SMEs access debt funding from the banks.


Australia Post employs classic banking strategy

AB+F - 25/06/2014

theBankDoctor talks to AB&F about how former NAB chief Ahmed Fahour is using a proven banking strategy to separate Australia Post into a “Good Post” and “Bad Post” structure.


Five sure ways to get your banker offside

ABIS - 23/06/2014

theBankDoctor explains the five sure fire ways to offend your banker. These are to be avoided at all cost.


How to build a better relationship with your bank

eXPRESSO - 14/06/2014

The relationship with your banker can make or break your business. theBankDoctor offers six tips to build a healthier banking relationship.


Is it wise to borrow from family or friends for your business

SmartCompany - 10/06/2014

Sometimes it makes sense to borrow from family and friends but this does have its own set of issues. This article explains the pros and cons of this increasingly common way of funding a business.


Eight ways to minimise your Bank Risk

SmartCompany - 19/05/2014

theBankDoctor explains what SMEs can do to minimise their reliance on their bank and maximise the prospects of the bank being there for them in their time of need.


The problem with lack of competition in banking for SMEs

SmartCompany - 15/05/2014

SMEs are heavily dependent on banks to fund their growth but the gap between them has never been wider. Why is lending to SMEs so hard for the banks?


The future of Debtor Finance

ABIS - 06/05/2014

Debtor Finance is a great product for growing SMEs but two of the big banks have exited the market so what is the future of Debtor Finance?


Why big banks can't seem to keep SMEs happy

SmartCompany - 23/01/2014

Smaller businesses are more dissatisfied with their banks than larger ones; and the larger the bank, the more likely its SME customers aren’t happy.


Six biggest pitfalls in business banking offer letters

The Age - 03/12/2013

It pays to read the fine print before you agree to a bank loan's terms.


Would your bank be there for you in your time of need?

ABIS - 25/11/2013

Bank Risk is hugely important because if you lose the support of your bank your business can go down hill in no time. In addition to being one of the most significant risks faced by business, Bank Risk is also one of the most underestimated.


Where are the staff?

SMH - 13/11/2013

The banks have laid off thousands of people but will there be enough qualified staff on the ground to the handle the demand for business credit when it inevitably comes?


It's time for a better banking deal for SMEs

SMH - 24/10/2013

The banks say they want small businesses as customers - but do they really?


The ins and outs of bank guarantees

ABIS - 18/10/2013

Nothing galvanizes the attention of bank leaders more than bad debts. Last year more than 22 per cent of business failures occurred in the building and construction sector, a notoriously big user of bank guarantees and performance bonds.


Building rapport with your bank manager

SMH - 26/08/2013

It's in small business owners' best interests to develop a good relationship with their bank manager.


The banks hold the key to success

The Australian - 30/04/2013

Many small business owners get
into trouble with their banks because
they don't know how to deal
with them and get the best out of
the relationships


The New World of Business Banking.

AICD - 01/02/2013

We are in a market characterised by pessimism, uncertainty and self interest. So what is really going on with our banks and their lending to Australian businesses? What has changed and why? And what can businesses do to optimise their chances of survival and success?


The new world of business banking

The Australian - 31/01/2013

What is really going on with our banks and their lending to Australian businesses? What has changed and why? And what can businesses do to optimise their chances of survival and success?


A bit of governance common sense.

AICD - 01/11/2012

The biggest risk for many small companies is not deteriorating trading conditions, staff shortages or myriad other operational problems. Rather, it is the surety of their banking relationships. Nothing kills a company faster than when the bank withdraws funding support because a loan covenant is breached.

Building Better Banking Relationships

Investment Edge - 01/08/2012

Small businesses have limited access to capital so bank debt is hugely important in helping grow with their bank. What are the steps they can take to build a better relationship with their bank?


Dealing with banks in times of crisis

SMH - 06/06/2012

Maintaining a good working relationship with banks in tough times may be difficult but it will help your business stay afloat.


Don't look for a new bank, love the one you're with

MyBusiness - 13/02/2012

The Stephen Stills song from the 1970’s “Love the One You’re With” best encapsulates the approach businesses should adopt with their banking relationship In the current challenging economic environment.


Not All Guarantees Are Created Equal

The Australian - 24/08/2011

Banks generally insist on SME owners personally guaranteeing the borrowings of the business. Fortunately, the vast majority will never have their guarantee called on, but for those who are destined to suffer this fate, the experience will test their financial and emotional reserves.