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Australian Brokers Favour Non-Bank Lenders for SME Financing

Speed and Efficiency Drive Shift in SME Loan Preferences

Australian Brokers Favour Non-Bank Lenders for SME Financing?w=400

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In the evolving landscape of small and medium-sized enterprise (SME) financing in Australia, a significant trend has emerged: brokers are increasingly directing their clients towards non-bank lenders.
This shift is primarily driven by the need for faster loan approvals and more streamlined application processes, especially for loans under $500,000.

Recent research by Banjo Loans indicates that over 40% of experienced brokers, those with eight or more years in the field, now prioritise non-bank lenders when arranging business loans for their SME clients. This preference is particularly evident in loan amounts ranging from $100,000 to $500,000, where speed and flexibility are paramount.

The study highlights that for loans between $100,000 and $250,000, nearly half (48.7%) of brokers choose non-bank lenders as their first option. Similarly, in the $250,000 to $500,000 bracket, 43.5% of brokers favour non-bank institutions. In contrast, larger loans exceeding $2 million continue to be predominantly managed by traditional banks, with only 3.1% of brokers opting for non-bank lenders in such cases.

Several factors contribute to this growing inclination towards non-bank lenders:

  • Rapid Credit Decisions: Non-bank lenders are known for their swift assessment processes, enabling businesses to access funds more quickly.
  • Operational Efficiency: Simplified application procedures and reduced bureaucratic hurdles make non-bank lenders more appealing to both brokers and their clients.
  • Flexible Loan Structures: Non-bank institutions often offer more adaptable loan terms, catering to the diverse needs of SMEs.

Brendan Widdowson, Chief Commercial Officer at Banjo Loans, emphasised the importance of these attributes, stating that experienced brokers seek lenders who can provide quick decisions, clear communication, and certainty for their clients. This demand has led to a notable increase in brokers prioritising non-bank lenders to meet these expectations.

Despite this shift, it's important to note that traditional banks still maintain a stronghold on larger, multi-million-dollar facilities. However, for smaller loan amounts where agility and responsiveness are crucial, non-bank lenders are becoming the preferred choice.

This trend underscores the evolving dynamics of the SME financing sector in Australia. As businesses continue to seek efficient and flexible funding solutions, the role of non-bank lenders is likely to expand further, offering SMEs the support they need to thrive in a competitive market.

Published:Friday, 27th Mar 2026
Author: Paige Estritori

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.

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