NAB shuns fintechs for in-house platform
(31 May 2016 – Australia) Australia’s largest lender to businesses, National Australia Bank (NAB) has bypassed the fintech craze and announced an in-house, online business lending product.
This week, the bank announced that QuickBiz Loan, developed via its innovation hub NAB Labs, would be launched in June, offering small businesses up to $50,000 unsecured via a new online application process.
In contrast, NAB’s “Big Four” competitors have opted to partner with fintechs and take referral fee for businesses they recommend. Currently, Commonwealth Bank and Westpac are in referral partnerships with online lenders OnDeck and Prospa respectively.
Howard Silby, executive general manager business lending, said: “Our expertise around credit decisioning and building our own credit model for these customers enables us to control things within our own risk appetite and provide a good customer experience given that we’re not handing customers off to other fintech providers,” he said.
“There does remain a question mark around the credit capabilities of some of the fintechs.
“We’ve watched developments in the space and been very determined … to make sure we have our own NAB-branded solution that we’ve built from scratch.”
To qualify for loans through its new platform, businesses must meet a variety of strict criteria including having been in operation for at least one year, be a sole trader, in partnership with two or fewer partners or a private company with directors.
The business also needs to be linked to cloud accounting software providers Xero or MYOB.
According to Scottish Pacific’s SME Growth Index, small business owners said they wanted more access to credit which is not secured to assets such as the family home. Businesses highlighted this concern as the most important factor when seeking to fund growth.
NAB business lending division chief Angela Mentis said that NAB was seeking to address that problem.
“We’re really placing the emphasis on the strength of the business rather than the traditional bricks and mortar security," she said.
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