G&H Financial

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Commercial Lending Heroes

There has been a shift in the Australian finance arena and the changes haven’t stopped for the last ten years. The lending landscape for small and medium businesses continues to challenge our perception of banking as we think we know or understand it. The simplicity of lending money was what drove the debt market, this drive is the same catalyst that in many examples has created asset valuation bubbles.


Historically money was always loaned under a common understanding that the asset underpinning the money could always be retrieved by the sale of the asset should anyone find themselves in a position of distress. Lenders were always favourable towards transactions that included a decent deposit or a low loan to value ratio. Following on from overzealous asset lending that subsequently led to losses; the industry began to focus more on a combination of the asset valuation combined with the character of the applicant. The three C’s of credit become an important and critical part of an assessment. Financiers were cashing in on huge gains in the 90’s and this led to cycles in transactions that encouraged lenders to dig deeper and buy up larger pieces of the market simply by lowering the entry barrier. This was actually fortunate for businesses. Money was cheap and easily accessible through bank-owned finance companies.


The Global Financial Crisis has a lot to answer for when it comes to where we find ourselves now and the next market correction probably won’t help but in large we have isolated some of the systematic issues that led to the GFC. Post GFC there has been a mobilisation of government minds to try and restrict possible future financial blowouts; this has led to legislative changes that have impaired bank lenders.


There were two main factors that have hamstrung bank lending channels; changes to the banking code of conduct make it harder for lenders to enforce. When the GFC hit in 2008 a number of lenders were seriously concerned about the viability of their businesses; some had to be saved; others took up a government guarantee, however, to do this they had to deconstruct or bring their finance arms under their bank licence.


All these changes have had a huge impact on the finance landscape. The Banking Royal Commission added to all these challenges and compounded them by throwing in social pressure for a more responsible practice or approach to financial services. The Australian regulators are doing a great job ensuring banks and lenders are kept in check, although, all these factors combined have had an obvious effect on the cost and availability in funding.


Fortunately, there are a number of lenders outside of the banking arena with the scope and agility to still work hard and provide small and medium businesses with the financial support they require for essential growth.


The top 10 lenders in the Australian non-bank arena in my mind are as follows:


  1. Morris Finance; the team in Geelong are not only highly skilled but also very commercial in how they approach transactions, their many years of supporting business is obvious in every transaction. Point of difference: exceptional service.

  2. AR Cash Flow – Dan Dunsford and the team have an outstanding ability at measuring risk and have always been nimble enough to work on a clear mandate that helps clients achieve their business goals. Point of difference: fast and efficient.

  3. Leasewise; a fantastic team with a strong understanding of the truck market and always ready to support any business operating in the logistics industry. Point of difference: will work with bank statements and/or financials.

  4. Prospa; a business that has proven its purpose over and over again. Transactions are processed and analysed at record speed with clients that speak volumes of their professionalism and purpose. Point of difference: Fast.

  5. Grow Finance; a watch this space moment for Australian small business. Finally a big player that has committed its cause to building businesses. After first hearing of Grow I was sceptical but having worked with them I am genuinely impressed; not only by their approach but also the way the communicate and how they work. Point of difference: A financier with a heart for small business.

  6. Octet; a titan in Australian business lending and notably good with business that fits in its wheelhouse. Point of difference: very good to work with

  7. Scottish Pacific Business Finance; I have been lucky enough to see the team working together, this company is a tight crew of hard-working individuals that come well together as a team to not only serve clients well but also to invest time and effort into their partner businesses. Point of difference: People.

  8. Angle; a great company to work with; fantastic at funding almost any asset which in itself makes them unique, fast response times. Point of difference: 3 hour turn-around for an approval consistently.

  9. Quest; last but certainly not least. This business looks set to fire up competition in their market space. A recent acquisition and new talent in their team has set the stage for Quest to gain market share. Point of difference: exceptional at communicating its appetite for risk.

This was a hard list to compile as there are many more worthy and equally as good working to provide small business with support and capital funding to not only assist with growth challenges but to also help them tackle unexpected costs associated with running a business. If the banks have said no then it’s worth looking at alternatives.


G&H Financial is a specialist in private equity, non-bank and non-confirming scenarios. Our business helps to establish a clear path to business funding through all channels and we have the capability of running credit in-house prior to looking at extending an offer so that we can ultimately find our clients the best offer without damaging their credit file.


Call us today on 1300 202 878 or find us at www.gandhfinancial.com.au

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