BusinessWhy Should You Look Beyond The Big Four For Loans?

Why Should You Look Beyond The Big Four For Loans?

Did the Big Four say no? That’s alright! There are several other options available to you.

If you went back in time, you’d be hard-pressed to name more than a few online business lenders in Australia in 2010.

There has been a massive increase in the business of alternative lending in Australia over the past decade. Nowadays, it’s not unusual to come across business loan brokers that tout a network of over 80 Australian banks and non-bank lenders.

Why are company owners looking to alternative finance as a solution instead of traditional lending? Let’s find out.

1. Qualifications are Less Strict

It is easier to get a loan from an alternate source. It would be best to show that you can afford to repay the debt, but the procedure is far more equitable and reasonable than in the past.

Non-traditional methods of establishing a borrower’s creditworthiness, frequently in conjunction with credit reports, allow lenders to receive a complete financial picture of a borrower.

Many now consider alternative finance more balanced and fair in making credit choices.

2. Faster Loan Process

A rapid loan from alternative lenders may sound like another new loan firm you see on television, but it is precisely that. Traditional bank loans might take months to process, whereas these loans can be processed in days.

Time can be lowered to less than 24 hours with other lenders in certain circumstances. They can handle these applications quickly because of the manner they approach them.

In the first place, they’ll look at your company’s financial records, which will provide a clear image of your financial history, debt repayment methods, industrial sector, and outlook for the future.

If they have this information, they can provide you with an estimate without submitting it for approval and sign-off from other departments, which would delay your loan application even further.

3. Short-Term Financing

Many firms aren’t interested in securing large sums of money; instead, they want short-term loans.

As a general rule, banks like to emphasise greater loan amounts since larger loans mean more profits for the banks. 

Many small and medium-sized enterprises, on the other hand, are looking for smaller loans. Companies providing alternative lending in Australia can better cater to their needs.

4. No Restrictions on How You Use the Funds

Some small company loans have extremely particular conditions attached to them.

For example, a construction business may apply for a loan to use the money to purchase a new bulldozer, and the lender will demand that you do so.

Non-bank lenders, for the most part, do not impose such restrictions on their loans. You are free to utilise the money how you see appropriate to expand your business.

5. Online Ease

The ease of having an online account and not needing to visit the bank to negotiate adjustments is also appealing.

Application and change may be made online, which is far more business-friendly than filling out documents and waiting forever for a decision.

As more and more people seek online loans, companies are more likely to find them from alternative lenders than traditional banks. It further cements their choice to shun banks, many of which have undoubtedly previously declined loan applications in the past.

Endnotes

According to data compiled by the Australian Bureau of Statistics, 99.8% of businesses in Australia are small and medium-sized enterprises (SMEs).

Almost all of these enterprises are struggling financially, so they frequently look for new sources of finance.

Australia is the second-largest alternative financing market in the Asia Pacific. Alternative financing in Australia may be able to supply your company with the adaptability and speed it requires.

After doing some research, you’re likely to discover that alternative financing is the ideal solution!

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