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There’s no question that SMEs continue to be a growth market, and represent a big opportunity for brokers.
A core characteristic is the consistent juggle of working capital requirements combined with the ability to recognise and desire to exploit business potential.
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Conversely, there’s an increasing demand for flexible, quick financing that the short-term lending market is naturally geared to.
The Interim Finance loan book has always been strongly represented by SMEs. This year, over 85 per cent of our settled transactions came from and went to SMEs.
This has risen 17 per cent over the last 12 months, and reflects the general shift in the sector, with small-business confidence improving now that the GFC is now firmly in the rear view mirror.
I encourage brokers to tap into the opportunity within their own books. Don’t just regard your database as a farming ground for home loans when it’s very likely that a good portion of your client base are SMEs, and by definition, have ongoing cash-flow/capital requirements.
Stock purchases, expansion, tax payments, and equipment are all common and good reasons why these facilities maybe appropriate. These requirements may be big or small, but may not necessarily warrant a full refinance of their residential property to accommodate this temporary requirement – so why upset a cheap housing rate when other cost-effective options are available?
These types of shorter-term loans are generally approved within the day, and can take as little as a week to settle – something major banks cannot do and have no interest in doing.
There is a direct and immediate opportunity for brokers to diversify into this lucrative sector, and thus, expand their client base while strengthening their service offering.
Andrew Littleford is a recognised leader within the short-term finance industry. As the director of the established short-term lender, Interim Finance, Andrew heads a team that’s committed to providing purpose-specific lending solutions throughout Australia. The company is known for its best-in-market rates and seamless back-end support that ensures compliancy. As a professional lender with over 20 years’ experience in the sector, Interim Finance prides itself on its transparency, solution-focused and relationship-driven approach.
