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Small business owners beware: your access to credit is under threat

<i>Photo: Getty</i>
Photo: Getty

The Royal Commission has made waves in the industry finance and banking industry, but there is still more to come.

High-ranking executives are departing their jobs and big banks have been forced to apologise to consumers and announce reforms to remuneration, culture and compliance practices.

Also read: 7 apps you need to run a business from your phone

But what does the inquiry mean for the smaller end of town – the businesses which depend on the major institutions for access to finances?

Unfortunately it looks like smaller firms are going to find it harder and harder to access credit, and instead will need to turn to specialist lenders, according to a recent poll by finder.com.au.

The poll also found that a quarter of businesses would hire less employees or could fold due to issues accessing funding.

<i>Source: Finder.com.au</i>
Source: Finder.com.au

Finder.com.au’s insights manager, Graham Cooke, said that now was an opportune time for smaller lenders and fintechs to shine.

“Increased oversight creates stricter lending criteria which usually means the smaller players can’t access cash as easily,” he said.

“There is a big opportunity here for smaller lenders to gain an edge over the big banks due to the increasingly competitive market.”

Also read: ‘Buy now, pay later’ firms and ‘debt vultures’ to face Senate inquiry

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