It’s been a big week in Canberra, but while the spotlight has been on the NBN and Korea, the issue of small business access to finance continues to bubble away.
Earlier this week, the Australian Chamber of Commerce and Industry held the first meeting of a specially-convened taskforce charged with looking specifically at small business access to finance, and examining any moves that could improve competition in the banking sector.
The chief executive of the ACCI, Peter Anderson, hit the nail on the head when he said there was a danger the concerns of small business could be drowned out among the chorus of complaints about the treatment of mortgage holders.
“While banks have shored up their margins at the expense of both business customers and mortgage holders, small and medium businesses have done it the toughest in a less competitive market. Only one in three people have a mortgage, but almost every business has a loan or overdraft that has to fuel investment and pay the bills.”
Get daily business news.
The latest stories, funding information, and expert advice. Free to sign up.
Another promising snippet coming out the nation’s capital was a report that Parliamentary Joint Committee on Corporations and Financial Services, chaired by respected Labor MP Bernie Rippol, is set to announce (possibly today) a fresh inquiry into how big banks deal with SMEs.
The exact terms of reference are yet to be announced, but it is expected that the inquiry will look at competition levels and the access of rural and regional businesses to funding.
While there are bound to be calls of inquiry fatigue when this latest inquiry is announced – you may remember we’ve had two Parliamentary inquiries into this subject in the last 18 months – the plain fact is that the situation is not changing.
The advisers and entrepreneurs that SmartCompany talks to every day are telling us that getting finance from a bank remains difficult, particularly if you are in the retail or property sector and particularly if you are a younger business that is growing fast. Our Smart50 survey showed many entrepreneurs have given up trying to get funding from the banks and are instead concentrating on angel investors and even peer-to-peer funding.
Indeed, this morning we spoke to a banker at one of the majors who said the internal focus remains firmly on the housing market.
We are going to keep on about this until we see some real change. It’s great to see our politicians and employer groups haven’t discarded the issue either.