Banking News

AFIA Australian Equipment Conference Key Take Aways

AFIA Australian Equipment Conference Key Take Aways

(16 November 2017 – Australia) The 2017 Equipment Finance Conference presented attendees with an opportunity to think more strategically about growing their business. Equipment finance facilitates a large portion of the nation’s capital expenditure. The industry is vitally connected to Australia’s productive base helping businesses to succeed.

This year the Conference focussed on how to succeed in an environment of emerging industry challenges that threaten business success. Some key takeaways from the event included:

Paul Fletcher MP, Commonwealth Minister for Urban Infrastructure

  • An increase in the use of driverless cars – with road infrastructure will be increasingly difficult to maintain.
  • Government lifting spending – e.g. WSA Badgerys Creek Airport

Peter Munckton, BOQ Head of Markets Analysis

  • Business confidence is high, in contrast to low consumer confidence, and low wages.
  • Global debt load at an all-time high, while interest rates at 5000-year lows

Murray Chapman, NSW Police

  • NSW experienced around A$250 million  in car finance fraud. 
  • Know Your Customer is key to reducing fraud. The SARA model developed with other government agencies including AUSTRAC and AFIA.

Tony Prior, AUSTRAC

  • False documentation bulk of fraud

Michael Andrew, Chairman of the Black Economy Taskforce

  • The domestic “black economy” has grown by 50 percent in last five years, with a shift from cash to non-cash transactions. It now it worth A$50billion, or four times larger than offshore tax avoidance. Follow and disrupt illegal funds flows.
  • 50,000 ABNs attached to tourist visas. Once an ABN is granted, it’s not tested in the future. 3.5 million ABN never lodged tax.

Dave Schaefer, Incoming chairman of the US Equipment Leasing and Finance Association (ELFA)

  • Equipment Finance volumes to dip in the US in 2018
  • Increased competition from fintechs - Square Working Capital is a big threat as they lend on cash flow, and have “big data” advantage
  • With growth of online lending firms such as On Deck and Funding Circle, importance of online fraud prevention is rapidly increasing

Round table: Kevin Foo (ASIC) / John Canning (Mallesons) / Olga Ganopolsky (Macquarie)

  • Dubbed the "Carnell Clauses", small business lending contract changes now flowing through
  • Commercial challenge - more than just data

James Middleton, Tesla Enterprise Manager

  • Telstra is experiencing rapid growth  in the deployment of  power pack charging centres
  • Customers buying cars but also PowerWalls and Solar

Jamie Osborn, GetCapital

  • Focus on SME lending gap and unmet demand. High flexibility, expensive lending to prime
  • Equipment Finance has lagged on innovation. Opportunities are there but they risk disruption

David Gondolfo, CAFBA

  • Broker channel not yet disrupted by digital despite concerns
  • Interaction methods changing slowly - 24/7 contact

Peter Drennan, Qi Insights

  • A$34.35 billion new business written 2017 and set to grow to A$39 billion in the next three to five years at current CAGR
  • 1 in 3 members have grown by 10+ percent
  • 1 in 5 members have declined by 10+ percent

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