Moneytech forges partnership with Factfin

Moneytech will partner with insurtech start-up Factfin to give SMEs better access to working capital.

A specialist trade and debtor finance business, Moneytech has provided $2.5 billion in finance to SMEs since it began in 2003.

Access to capital continues to be difficult for SMEs in the wake of tighter capital requirements under Basel III.

According to Moneytech chief executive Hugh Evans (pictured left), this is set to be challenging in the shadow of the banking royal commission. Evans expects further tightening in the sector following the public inquiry with an even more conservative approach to lending standards, a view already shared by Small Business and Family Enterprise Ombudsman Kate Carnell.

“It still holds true in Australia that banks lend money to SMEs based on the size of your house. With the challenges under Basel III and the royal commission, it is expected banks will cut back lending to unsecured SME lending,” Evans said.

“At the same time, we have to make sure that we get the money back that we lend. Access to data will give us better insights into the risk of a business given that we can’t rely on property for security,” he said.

Here the partnership will bring Factfin’s expertise in data analytics and insights to helping the business assess the riskiness of its SME book.

While Moneytech has adopted a very prudent process in assessing SME risk, the approach could benefit from further automation.

“As more business’ shift online, they expect their finance partners to be online in all aspects of their business. Our partnership with Factfin will unlock digital risk assessment, giving us the ability to scale our services to more SMEs,” Evans said.

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Source: Moneytech forges partnership with Factfin | RFi Group