(9 June 2026 – Australia) Australian small and medium-sized enterprises (SMEs) are increasingly turning to non-bank lending solutions to support everyday business operations, with new research showing that the vast majority of business owners were open to using a non-bank.
According to ScotPac’s long running SME Growth Index Report based on direct interviews with 728 SMEs conducted by East & Partners, 92 percent of SMEs have either already used, or would consider using, a non-bank lender for their commercial finance needs.
34 percent of SMEs sourced non-bank lending in the past 12 months, importantly not just for capital expenditure, but to support broader business borrowing needs including working capital, cash flow management and operational resilience.
Most SMEs sourced an average of 67 percent of borrowings from a single non-bank as small business owners increasingly turn to non-banks to provide flexible solutions quickly and reduce reliance on property security that is typically required from a bank against new loans.
The SME Growth Index found that 1 in 5 SMEs were drawn to non-banks because they didn’t want to rely on using personal guarantees or non-property assets as security (19 percent), with 16 percent drawn to non-banks because they didn’t have to use their family home as collateral.
“The results reflect a significant evolution in how SMEs are thinking about finance. Non-bank lending is no longer viewed as a niche or secondary funding option. More SMEs are integrating flexible funding solutions into their core business strategy to improve cash flow certainty, unlock working capital tied up in assets like invoices, and reduce pressure on personal balance sheets” commented ScotPac CEO Jon Sutton.
Mr Sutton said businesses were increasingly looking beyond traditional term loans towards more adaptive funding structures linked directly to business activity and cash flow. Demand for flexible funding solutions continued to grow across sectors, including transport, manufacturing, wholesale trade and professional services, where cash flow timing and working capital management remain critical business challenges.
“Asset-based lending solutions, such as invoice finance and working capital facilities, allow businesses to access funding based on the strength of their receivables and trading activity, rather than relying solely on property-backed lending. That flexibility is becoming increasingly valuable as SMEs navigate rising operating costs, uneven trading conditions and tighter credit environments.”
“Businesses are becoming more strategic about liquidity, cash flow resilience and reducing concentration risk, and ScotPac has the broadest range of finance solutions to support them. Brokers who understand asset-based lending and working capital options are increasingly well positioned to guide SMEs through changing market conditions.”
Annie Kane reports for The Adviser that brokers are also diversifying the number of non-bank lenders they are working with, rising to nine different non-banks championed by brokers for their lending products.