Editor's Letter: Opportunities for the taking

The perks of adding commercial lending to your repertoire

While researching and writing this special commercial lending issue, I learned a lot about the challenges that SMEs face in accessing finance, the opportunities that abound for brokers in this space, and the many complex products and offerings that exist.

On a few occasions, I had to admit to my interview subjects that I didn’t understand, and ask if they could explain things again. While I’m still not an expert in commercial lending, I do have a better understanding and great empathy for what a residential broker goes through when writing their first commercial loan.

It does seem daunting and intimidating. Just looking at the numbers is overwhelming: the total volume of commercial loans in Australia is around $658bn.

But what I found was only patience and willingness from lenders, fintechs, aggregators and commercial brokers to break complex subjects down into simpler terms – and explain things again. You just have to ask.

Know when to refer work on to others; know when to seek assistance and ask for help; know when to admit what you don’t know

Lenders obviously want brokers to write commercial loans, and they’ve got plenty of support and training programs in place to accommodate every skill level, so it’s a smooth transition. They also spoke highly of the collaborative element that is an important part of the process of seeing through complicated commercial deals.

While branching out into commercial lending is a good idea for many reasons – to better meet the needs of your existing customer base and diversify your revenue stream – you have to decide if it’s the right move for you and if it complements your long-term business goals.

According to one experienced commercial broker, it is worth choosing a few areas of commercial finance to specialise in rather than trying to do a little bit of everything. Know when to refer work on to others; know when to seek assistance and ask for help; know when to admit what you don’t know.

This has been a great learning experience for me, and there’s still plenty more to explore in this thriving sector. For those with experience in commercial lending and those just starting out, we hope this issue helps you do what you already do best: serve your clients.

Otiena Ellwand
editor,
MPA