In what it described as an attempt to support its small business customers, one of Australia’s largest banks has promised to overhaul its SME loans process, including offering same-day decisions on some loans.
Commonwealth Bank (CBA) issued a statement in which it announced measures aimed at streamlining its lending processes for business customers.
To commence in March 2019, the bank said that it would offer same-day lending decisions for unsecured business loans of up to $250,000 for eligible existing customers.
Drawn-out lending determinations have often been cited as a major bugbear of business leaders towards traditional banks, and have been seized on by alternative finance providers as a means of winning over SME customers.
In addition, CBA said that it would remove default interest charges from business term loans to support drought, fire or flood-affected farmers, and pledged to support businesses “even more” than the $580 million it lent to business each week, on average, throughout 2018.
It also said that 10 business banking fees have been scrapped over the past year.
“Small businesses are the engine room of the Australian economy — when they thrive, we all thrive. So I’m delighted to announce a series of changes today to support our small business customers,” the bank’s CEO, Matt Comyn, said.
“We’re committing to support business lending even more, rolling out same-day decisions on simple business lending, removing more business banking fees, providing financial assistance when it counts and increasing the capacity and capability of our Australia-based business contact centres.”
According to Mr Comyn, the moves are part of CBA’s efforts “towards becoming a better bank”.
“We are committed to turning our words into action and to be better for you, delivering real benefits and improving processes to ensure we remain focused on what our customers want,” he said.
“While we’re making good progress, there is still more work to do. We are determined to restore respect and trust amongst our customers and communities. Our customers can expect us to continue listening, making changes and providing the best possible experiences, no matter how they bank with us.”
The announcement comes just a week of the final report from the banking royal commission was publicly released. On the whole, the report was rather sedate on its findings into SME lending, although it did recommend extending the definition of a small business to include loans up to $5 million (up from the existing $3 million threshold) and the launch of a national farm debt mediation framework.
Both the federal government and opposition have promised to act on all 76 of the commission’s recommendations.
Adam Zuchetti is the editor of My Business, and has steered the publication’s editorial direction since early 2016.