CEO says the reluctance to lend will drive alternative lender growth
Australian non-banks have been slowly making gains in the New Zealand market, and Apricity Finance CEO Linden Toll says we are likely to see more offerings open up over the next few years - particularly as the main banks start declining more deals.
Toll noted that the non-bank offering in Australia is already fairly well developed, and many of those lenders are now looking at New Zealand as an untapped opportunity. He says Apricity has already been receiving strong interest from borrowers, and as main banks become more reluctant to lend to businesses, the move towards alternative lenders is only going to increase.
“The interest is definitely growing,” Toll said.
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“As the non-bank sector matures in Australia, they’re looking for opportunities in New Zealand, so we’ve seen a few of those lenders come over in recent years.”
“I think the main banks are struggling at the moment with what they can offer for a whole raft of reasons - regulation, perception, etc. Speaking to people in the market we’re hearing that the banks are knocking back deals that they used to do every day,” he explained.
“So people are looking for alternatives, and there is a genuine need for it. Those gaps will get filled by the non-banks, and there are some really good operators out there.”
The start of the COVID-19 pandemic last year may have disrupted many businesses, but Toll says that alternative lenders will likely see renewed interest over the coming years as businesses look to get back on their feet and drive growth.
“At the start, none of us had a clue of what was going on - normally you could speak to your mum or dad, and ask what happened in the COVID of 1964, but there hadn’t been anything like that,” Toll said.
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“Business mentors, advisers, accountants, lawyers - nobody had any idea of what was going to pan out. So initially, it was all about making sure the clients got what they needed, and we cut our rates across the board to every client to ‘share the pain’. We haven’t shifted those back, and we don’t intend to.”
“However, our clients also tend to come from sectors that didn’t stop during COVID, so while new client enquiry was subdued, our existing client base grew organically based on new contracts, and the stimulus offered by the government,” he added.
“We’re now seeing record enquiries in Australia and New Zealand, and there are various sectors that are starting to look at us as an option. We think it’s going to be a positive few years going forward.”
