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Financing SME Innovation in Australia – Challenges and Opportunities

Financing SME Innovation in Australia – Challenges and Opportunities

(5 April 2024 – Australia) SMEs are potential engines of innovation and dynamism in the Australian economy the Reserve Bank of Australia (RBA) Assistant Governor Financial System, Brad Jones declared in a speech at the COSBOA National Small Business Summit.

Small businesses introduce competitive tension to established markets that are typically dominated by larger incumbents, driving them to be more efficient in the process. Unleashing this creative energy first requires access to financing on reasonable terms. For a long time, this has been easier said than done…

SMEs that are further along the commercialisation journey might be eligible for funding from the Australian Business Growth Fund (ABGF), which was established just prior to the pandemic to provide both long-term growth capital and strategic advisory services for expanding SMEs.

Prime Minister Anthony Albanese has promised Australia’s 2.5 million small business owners they will benefit from measures in the May 14 budget, as the federal government finalises ongoing energy bill relief.

“SMEs have become increasingly important participants in the innovation ecosystem in Australia, particularly in professional, scientific and technical services. In some respects, they appear to be taking over the ‘innovation baton’ from large firms, including in early-stage investment in research & development and intellectual property rights” stated RBA Assistant Governor, Financial System, Brad Jones.

“While the Australian financial system and policy settings have interacted to lend more support to innovation-focussed SMEs over the past decade, there is more to be done if the next generation of innovative Australian firms are to have the wind at their back.”

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