U.S.-based Biz2Credit is helping to launch a new alternative lending platform in Australia.
The company is reportedly working with Australian Finance Group (AFG), which is looking to enter the small business lending space. Reports on Monday (Sept. 26) said Biz2Credit first struck a partnership with AFG in August.
AFG typically focuses on mortgage broking; reports said the company’s focus on SME lending signals a shift for AFG from wealth management. The company operates with 2,650 brokers in Australia, reports said, adding that, with its deal with Biz2Credit, AFG will look to roll out a new platform for small business borrowers early next year.
The tool will initially include 15 lenders from which SME borrowers can choose; reports said they’ll include both traditional and alternative FinTech lenders.
“The market really hasn’t been penetrated greatly by any of the broking groups,” said AFG General Manager of Commercial Keiran Evans, reports by The Australian said. “Certainly, all the broker groups are discussing how to address the commercial market. You will see more discussion about this market — it is going to be the next growth phase … in the broking industry.”
“Our brokers are coming across small customers every day for their home loan,” Evans added.
Biz2Credit Chief Operating Officer Robert Kleiber reportedly made a visit to Australia, a new market for the SME lending platform, and said the nation is “ripe for innovation” when it comes to SME finance.
“This is a growing market, and there’s a lot of opportunities that’s been underserved,” he added.
While the financial details of AFG and Biz2Credit’s partnership weren’t disclosed, reports said Evans did note that commission will be earned in a similar fashion to mortgages.
“This platform, through needs discovery, will highlight and match the customers’ requirements with the lender’s appetite,” he explained. “I have no doubt that’s the real power of this proposition — providing real choice and aligning the credit application with the credit criteria of the lender and quite often they can be mismatched, and that’s not a good outcome.”
Earlier this year, Biz2Credit revealed plans to enter India, another market the company deemed emerging and ripe for SME finance disruption.