THE Australian Bankers Association (ABA) has established a website to assist small businesses in obtaining bank loans.
The move has come in reaction small-to-medium enterprises (SMEs) complaints since the Global Financial Crisis of challenges in obtaining bank finance. The banking industry claims loans to the sector are dramatically on the rise.
“Banks approved $88 billion in new small business loans last year, which is $11 billion more than two years ago,” ABA chief executive Steven Münchenberg said.
“While banks’ lending to the small businesses sector is strong, we recognise that for some small businesses being able to access finance is still a concern. To help with this, we have developed a new website that explains what banks look for in assessing loan applications. It also shows how different types of finance may suit different small businesses,” he said.
The website – financingyoursmallbusiness.com.au – was developed in conjunction with CPA Australia and with the support of the Council of Small Business Australia (COSBOA) and NSW Business Chamber.
It features a step-by-step guide to completing a loan application, with particular emphasis on preparing a business plan.
CPA Australia chief executive Alex Malley said the ability of small business to articulate the how and why of their venture is extremely important to the success of their loan application.
“If we have small businesses growing, spending on new plant and equipment and expanding their markets, then they are sustaining and creating jobs and that’s precisely what our nation needs,” Mr Malley said.
COSBOA CEO Peter Strong said, “This is a great initiative by the banking industry and will help people who want to start, buy or expand a business save time and stress.”
NSW Business Chamber chief executive Stephen Cartwright said, “For small to medium businesses having access to finance is crucial to their success. Having this resource for SMEs to understand the right type of finance for their needs will help maximise their potential and in turn, help Australia’s economy to grow."
Mr Münchenberg said over the past couple of years the ABA has worked with COSBOA and CPA Australia to better understand the issues faced by small businesses.
“We realised that small businesses would benefit from guidance on how to present information in a loan application that goes beyond just providing the company accounts,” he said.