As Australia’s post-COVID economy continues to recover, demand for business credit among small and medium-sized enterprises (SMEs) has surged. According to the latest SME Growth Index Report by ScotPac, just 6% of SMEs have ruled out seeking new borrowings in the next six months, with nearly half of all SMEs now preferring online-only loans.
The report, which tracks the growth prospects and sentiment of Australian SMEs, reveals that 40% of businesses in a growth phase are anticipating a need for short-term finance. This trend highlights the vital role of credit in helping SMEs rebuild their operations, manage supply chains, and maintain cash flow after the disruptions caused by the pandemic.
The increased preference for online-only loan applications is one of the standout findings, with 48% of SMEs choosing to apply for finance purely through digital channels. This shift is largely driven by the speed and convenience offered by online applications, which are seen as a faster alternative to traditional in-person processes. Additionally, 19% of SMEs expressed a desire for the flexibility to switch between online applications and a dedicated customer service resource.
Despite the rise of online lending, the report also underscores the importance of expert support for businesses navigating more complex financial needs. Jon Sutton, CEO of ScotPac, noted that while technology has made access to finance easier, the demand for tailored advice remains strong, particularly for businesses in growth phases.
“The post-COVID recovery has prompted tens of thousands of SMEs to seek credit, not just to rebuild but to expand their operations,” Sutton said. “Regulatory changes have opened the door for non-bank lending, and technology has made it easier for businesses to find solutions that suit their needs.”
The report also points to the increased availability of alternative lending options, with non-bank lenders playing an expanding role in the market. For many businesses, these alternative options are seen as a faster and more flexible way to access the funds needed to fuel growth.
With rising demand for finance, brokers who stay up-to-date with new lending products are well-placed to guide SMEs through the evolving landscape of business finance. As Australia’s economy continues to recover, the ability for SMEs to secure quick and flexible credit will be a crucial factor in their ability to thrive in the years ahead.
