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In June 2025, Australian business lending experienced a notable increase, with loans to non-financial businesses reaching $1.14 trillion, marking a 9.2% year-on-year growth.
This expansion significantly outpaced the 5.6% growth observed in housing loans, which totaled $2.34 trillion during the same period.
The data, released by the Australian Prudential Regulation Authority (APRA), highlights a renewed appetite for corporate borrowing and investment.
The acceleration in business lending suggests that Australian companies are increasingly confident in their growth prospects, opting to invest in expansion and operational enhancements. This trend is particularly significant for small and medium-sized enterprises (SMEs), which are often at the forefront of economic activity and employment.
Several factors contribute to this surge in business lending. Firstly, the stabilisation of the economic environment post-pandemic has provided businesses with a more predictable landscape for planning and investment. Additionally, the competitive lending market, with both traditional banks and non-bank lenders offering attractive financing options, has made it more feasible for businesses to secure necessary funds.
For SMEs, this growth in lending presents both opportunities and challenges. On one hand, increased access to capital can facilitate expansion, innovation, and improved cash flow management. On the other hand, businesses must navigate the complexities of various loan products, interest rates, and repayment terms to select the most suitable financing options.
To capitalise on this trend, SMEs should consider the following steps:
Conduct a thorough assessment of their financial health and funding needs.
Explore and compare different lending options, including those offered by non-bank lenders who may provide more flexible terms.
Seek professional advice to understand the implications of various loan products and to ensure alignment with their business objectives.
In conclusion, the significant growth in business lending as of June 2025 reflects a positive shift in the Australian economic landscape. For SMEs, this environment offers a conducive backdrop for strategic investments and growth initiatives. However, careful planning and informed decision-making remain crucial to leverage these opportunities effectively.
Please Note: We do not endorse any specific products or companies. Some content is sourced from third parties, including press releases, and may not be independently verified for accuracy or completeness.
Australian small and medium-sized enterprises (SMEs) are demonstrating a notable shift in their financing strategies, moving from survival-focused borrowing to growth-oriented loan applications. Data from OnDeck Australia indicates a 42% year-on-year increase in loan applications during the December quarter of 2025, with a significant portion of these applications aimed at business expansion. - read more
Pallas Capital has recently introduced a substantial $380 million loan facility aimed at supporting small and medium-sized enterprises (SMEs) across Australia. This initiative is backed by one of the country's major banks, underscoring the growing collaboration between non-bank lenders and traditional financial institutions to meet the diverse financing needs of SMEs. - read more
For small businesses, the facility to obtain credit can dramatically affect daily operations and long-term growth strategies. Managed wisely, it allows for the leverage needed in negotiations, and procuring investment opportunities, and can often mean the difference between stagnation and scaling new heights in the corporate landscape. - read more
Cash flow refers to the movement of money into and out of your business. It encompasses all the income your business earns from sales, payments from customers, and investments, as well as all the expenses for operational costs, salaries, and other expenditures. - read more
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