Non-bank business lenders growing in popularity amongst SMEs
There is no doubt the big banks remain major players in the SME lending market however, there has been a steady rise in the number of non-bank lenders offering fast and flexible lending options in this space. They are able to move much faster than the traditional banker with their unique ‘fintech’ approach, giving small business owners across Australia alternative options when seeking business funding.
Going hand-in-hand with this preference for more flexible finance solutions amongst SMEs is the demand for unsecured lending options. Business owners are demonstrating they understand the need to pay a small premium in return for fast, flexible finance options which do not require them to place the family home up as security.
What is a non-bank lender?
Put simply, a non-bank lender is a financier who is not a bank or credit union. Instead, a non-bank lender will (in most cases) have privately raised funds with which it can lend under the criteria it chooses.
Benefits of non-bank lenders
In addition to offering unsecured options, non-bank lenders typically have far lower application requirements. Instead of being required to provide a full 12-months of financials for your business, along with a vast array of other paperwork, non-bank lenders often only require 3-months of bank statements to verify there is sufficient cashflow to service the requested loan amount. Further, non-bank lenders are less restricted by the regulations that are enforced on the big banks and are often able process, approve and fund loans inside 24-hours.
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