Brokers turn to alternative providers for smaller business loans amid demand for faster decisions
Australian brokers are directing more small and medium-sized enterprise (SME) clients to non-bank lenders, particularly for sub‑$500,000 facilities where turnaround time and process simplicity are decisive.
A survey by non-bank lender Banjo Loans of 334 brokers found that more than 40% of brokers with at least eight years’ experience now give non-banks priority in their business lending options for many clients. Larger, multi‑million‑dollar transactions, however, remain largely the territory of the major banks.
The shift is occurring as many SMEs adopt a more cautious stance on major capital expenditure. Banjo Loans’ data indicates that SME borrowing eased in late 2025 as uncertainty over inflation and interest rates led business owners to be more selective about taking on new debt, even while seeking funding to support growth.
“Experienced brokers want lenders who can move quickly, communicate clearly, and provide certainty for their clients,” said Brendan Widdowson (pictured right), chief commercial officer at Banjo Loans. “We are seeing more brokers prioritising non-bank lenders in their lending mix to meet these expectations.”
The survey suggests that non-banks are now the preferred option in several key borrowing bands. Nearly half of brokers (48.7%) said they would choose a non-bank first for loans between $100,000 and $250,000, while 43.5% indicated a non-bank would be their initial choice for loans in the $250,000–$500,000 range.
Non-banks are also in contention at the smallest end of the market, with 26.2% of brokers stating they would look to a non-bank lender first for loans under $100,000. By contrast, only 3.1% said they would approach a non-bank as their initial option for loans above $2 million, underscoring the continued dominance of traditional banks in higher‑value SME facilities.
“SMEs often need capital quickly within defined limits,” Widdowson said. “This is where non-bank lenders can add the most value for brokers and their clients.”
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