Small- and medium-sized business lending is picking up pace in Australia, fuelled by global uncertainty, rising costs and heightened regulatory pressure. Brokers stand to win by pinpointing borrower pain points and delivering tailored solutions.
According to National Australia Bank's (NAB) Q2 2025 Economics SME Business Insights report, cashflow, profitability and government policies and regulations are the most pressing concerns for SMEs. Roughly half of the 600 businesses surveyed for the report said that they're responding by cutting costs and renegotiating supplier terms as a result. At the same time, approximately 37% are increasing marketing efforts, 29% are investing in hiring and another 29% are updating pricing strategies to stay competitive.
"Running a business today means being obsessed with every detail, from the quality of your product to the experience you deliver," said Nick Palumbo, small business owner.
That makes a broker’s services and advice more crucial and relevant than ever.
Mortgage brokers who take the time to understand the specific challenges facing SMEs are well-positioned to expand their client base and add value beyond traditional home lending. With many SMEs grappling with issues like cashflow pressures, rising costs and tighter access to finance, brokers who can offer tailored commercial lending solutions or connect business owners with flexible financing options stand to deepen relationships and diversify their revenue streams.
"They move from being transactional to becoming trusted strategic partners – a change that not only delivers better outcomes for their customers, but also drives long-term profitability and stickier customers for brokers," Steve Sampson, chief executive officer of Sydney non-bank lender Prime Capital, told Australian Broker.
"At Prime Capital , we help brokers to understand SME lending, that's when they transform their role," he added.
Tighter regulatory oversight has made securing traditional bank loans more challenging for some businesses, particularly among self-employed borrowers. In addition, continued global uncertainty, and rising living and property prices in Australia have made it difficult for all borrowers in Australia.
"As the banks have pulled back, private lenders are really stepping up to fill those gaps and to fund those SMEs," said Julia Paton, cofounder and commercial broker at Melbourne-based Go For Broker. "But that area is still a little bit murky for people to navigate; it's unregulated and it can be really difficult for borrowers to find their way through. That's essentially where we come in and connect clients with trusted lenders, really structure those sharp strategic deals and guide borrowers from chaos to clarity in that space."
At the same time, lower interest rates have created a highly competitive lending environment, giving both brokers and borrowers an edge, driving lending momentum and encouraging many businesses to increase their borrowing.
In fact, lending activity was picking up even before the Reserve Bank of Australia's (RBA) August rate cut. The Roy Morgan Business Confidence Index revealed that confidence had increased 0.6 points in July.
"It's been very encouraging to see business confidence climb steadily over the last three months, above its long-run average, despite rising global uncertainty," said NAB Group Executive, Business and Private Banking Andrew Auerbach. "That's a strong, positive sign for Australian SMEs and the broader economy."
