Unlocking growth: Why brokers and non-bank lenders are reshaping business finance in Australia

The appetite for healthy debt – the type that supports business growth – is predictably rising in Australian boardrooms as interest rates begin to taper. But far less predictable is the lending pathway businesses will follow as traditional bank loans struggle to keep pace with faster and more flexible alternatives.

A recent survey by ScotPac found a record 55 per cent of businesses plan to fund new investment with non-bank lending. And the value of commercial loans settled by brokers hit a record high in 2024, with data from the Mortgage and Finance Association of Australia revealing a 23 per cent year-on-year increase. Fast, customised services are driving this change in approach.

Scale and speed for growing businesses

ScotPac specialises in providing the right type and the right level of support to our business customers. That is our sole focus. Unlike traditional bank lenders, we have the capacity and desire to expand loan facilities to keep pace with every stage of a business’s growth. We can back single borrowing groups with funds from $1 million up to $200 million. That positions ScotPac as a serious and credible finance partner for a wide range of businesses and commercial scenarios.

Speed to market is one of our greatest strengths. In M&A scenarios, ScotPac can assess the acquisition target’s assets and pre-approve funding, so the client is ready to move when the deal lands. That’s a significant competitive advantage for businesses operating in fast-moving sectors.

Partnering with brokers

ScotPac sees firsthand the value brokers bring to the table, especially when their clients have specific challenges like needing to move quickly on an acquisition target or navigating temporary financial stress. These situations demand a financing solution that’s fast, tailored, and commercially savvy. Again, that’s where ScotPac can make a real difference.

For more than 35 years, ScotPac has partnered with brokers to help them service their clients’ needs. Our asset-based lending model allows us to provide greater access to funding – often against receivables, plant & equipment, or inventory – in situations where banks may hesitate. This means more capital, unlocked faster, and with greater flexibility.

When flexibility matters most

As thousands of businesses, large and small, can attest, speed and flexibility in lending have been part of ScotPac’s DNA for decades. Recently, we worked with a manufacturing client pursuing a major acquisition. While the business had strong fundamentals, it had fallen outside its bank’s covenants due to growth-related working capital strain. ScotPac was able to step in, assess both businesses, and structure an asset-backed facility that released funding within weeks – well before the banks could provide a firm answer. It is one of countless examples that demonstrate how we work.

Let’s talk about price

While pricing is always part of the funding conversation, the good news is that the rate gap between banks and non-bank lenders like ScotPac has narrowed significantly in recent years, especially on larger deals. That means brokers and businesses assessing their options are likely to be pleasantly surprised. In many cases, especially when clients need to move quickly, without restrictive covenants, paying a little more for speed, flexibility, and better access to capital is a commercially sound decision.

Your partner for smarter SME lending

Beyond transactions, ScotPac supports brokers with practical tools to help kick-start funding conversations. One example is a Cashflow Health Check, which ScotPac offers to help brokers re-engage their clients, diagnose cash flow gaps, and introduce appropriate funding solutions at the right time.

Our message to brokers is simple: if you’re working with clients who are growing, in the market for acquisitions, or who just need a more flexible funding partner, talk to us. ScotPac is a genuine alternative to the banks for businesses looking for smart, scalable solutions up to $200 million. And just like we have done for more than three decades, our team will support you all the way.