SMEs look beyond traditional banking relationships

Most Australian small and medium businesses have moved to shore up their funding needs by entering a second lending relationship.
 
According to the latest ScotPac SME Growth Index report, 80 per cent of SMEs now have a secondary working capital provider.
 
This move coincides with 61 per cent of SMEs surveyed saying plan to invest in their businesses in the next six months – up 15 percentage points year-on-year.
 
Forty-seven per cent said they were prepared to work with a non-bank lender – an all-time high for the survey.
 
ScotPac chief executive Jon Sutton said: “Some of that [investment] growth can be attributed to higher input prices but the strength of SME investment intent goes beyond this factor alone.”
 
When asked to expand on their approach to getting into a secondary working capital relationship, 67 per cent of SMEs said ease of credit approval was the main factor and 37 per cent said higher credit limits were important.