Almost a quarter of small businesses are preferencing locally based credit institutions when searching for finance solutions.
According to new research from online SME lender OnDeck Australia – which included a survey of 300 business owners with a turnover of $50,000 to $5 million – one in five (22 per cent) respondents seek Australia-based lenders when exploring their credit options.
Robbie Fidler, OnDeck’s national broker channel manager, observed: “There’s no doubt that when it comes to the choice of lender, quantitative issues such as rates and fees matter to SMEs.
“However, our survey highlights that qualitative factors such as being able to access a local person to speak with, are still key issues for small business owners,” he said.
“That makes sense because it can be very reassuring for time-poor SME owners to know that someone is available on their home turf to talk through any queries.”
Mr Fidler added that the preference for locally based lenders presents opportunities for the third-party channel.
“From OnDeck’s perspective, we know that brokers are deeply invested in the client relationship. And this tends to be a two-way street: SME owners place tremendous trust in their broker,” he said.
“That’s why OnDeck provides the tools and resources that brokers need to deliver local support to their SME clients.”
Mr Fidler said OnDeck has worked to develop its broker proposition to ensure brokers can deliver good outcomes for their SME clients.
“We are about long-term relationships, and our 70 per cent growth in broker-generated loans in 2019, coupled with a high level of repeat enquiries, is testimony to the exceptional level of on-the-ground support brokers receive from OnDeck,” he said.
Research from MyState Bank recently revealed that brokers have played a key role in providing support to distressed financial services customers in the wake of the COVID-19 pandemic.
Two-thirds of mortgage brokers surveyed by MyState reported an increase in engagement with their customers since the onset of the crisis.