Help SMEs this holiday period

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As we head into the festive season, now is a great time for advisers to talk to their SME clients about getting ready for Christmas trade or the holiday shutdown, and how to manage end-of-year cash flow

PROSPA, New Zealand’s number one online lender to small businesses, commissioned research from RFI Group which showed that SMEs are expecting to need more financing over the coming 12 months, with about 65% reporting that they intend to apply for funding in the coming six months. Different businesses have different needs as the year moves into the festive season. It’s a busy time for sectors like retail, tourism and hospitality, with many businesses looking to stock up on inventory, hire extra staff and generally prepare for increased consumer spending. Other types of businesses, for example professional services, will likely have less cash flow as they shut down for holidays and customers switch gears into relaxation mode. While their needs may be different, our research shows that companies across the board are finding the cost of doing business is their main challenge. Three out of five SMEs, or about 60%, have experienced increased supply chain and labour costs, and 58% said they would probably have to invest in the business to generate cash flow.

Prospa Group Limited (ASX: PGL) is a leading fintech with a commitment to unleashing the potential of every small business in Australia and New Zealand. We do this through an innovative approach to developing simple, stress-free and seamless financial management products and services. Since 2012, we have provided more than $3 billion worth of funding to support the growth and operations of thousands of small businesses. We also work with over 12,000 trusted advisers, accountants and aggregator partners to deliver flexible funding solutions to their clients. At Prospa, we’re serious about our impact on our people, communities and the planet. Our core company value of ‘One Team’ is backed by our recognition as a Great Place to Work in Australia and a WORK180 Endorsed Employer for Women.

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“Prospa’s Line of Credit is a great option to help fund extra inventory or to cover staff wages during slower periods of trade, while our Small Business Loan is a good option for small businesses that are looking to expand and drive growth”

Adrienne Begbie, ProSPa NZ

In this environment, small businesses are seeking guidance, with almost a quarter of SMEs turning to a professional for advice about their business finances. This presents a great opportunity for advisers to add value to any SME client’s business and build trust. The research also identified three main areas that SMEs seek funding for: buying equipment, maintaining cash flow, and business expansion. It further revealed that reduced fees, quicker access to funds, enhanced flexibility and expert advice are among the factors that might prompt SMEs to explore alternative lending sources. Armed with this knowledge, you can hone advice to meet the specific needs of SME clients. Prospa’s mission is to simplify small business cash flow by offering a variety of tailored lending options. However, only two out of every three SMEs are actually aware of alternative lenders, which means many of them are missing out on the opportunity to bolster their businesses at one of the busiest times of the year.

With 65% of all SMEs intending to apply for funding in the next six months, and two in three applications submitted from Prospa’s adviser channel being approved, there are plenty of opportunities for advisers to advise clients about the benefits of non-bank lenders and grow their own business with a diversified revenue stream. One in three SMEs said they would consider taking out a loan with a specialised small business lender. Prospa managing director Adrienne Begbie acknowledges the belt-tightening phase small businesses currently face but says advisers can position themselves to take advantage of the festive period when trade is traditionally more abundant and enjoy exclusive Prospa Partner offers.

“Prospa has a number of exciting products designed specifically to address the unique challenges of SMEs. Our Line of Credit is a great option to help fund extra inventory or to cover staff wages during slower periods of trade, while our Small Business Loan is a good option for small businesses that are looking to expand and drive growth,” Begbie says. “We’ve also made it easier to make business happen with Prospa by offering all accredited and registered Prospa Partners a discounted Business Line of Credit to invest into their own business,” she concludes. At the end-of-year period, it’s crunch time for advisers intending to prepare themselves for the uplift by diversifying into SME lending. Start offering your SME clients fast access to the funds they need, plus enjoy an exclusive Prospa Partner offer to help you grow your own business. Partner with us

“I think cybersecurity is going to be a challenge for the whole industry and is something that we pay really, really careful attention to”

ADRIENNE BEGBIE, PROSPA NZ

Published 20 Nov 2023

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65%

of all SMEs intend to apply for funding in the next six months

of SMEs will turn to a professional for advice about their business finances

Almost a quarter

business owners/key decision-makers would consider taking out a loan with a specialised small business lender

1 in 3

SME demand for financing

Registered and accredited Prospa Partners can enjoy a discounted Business Line of Credit to invest in their own business

RFI New Zealand SME Banking Council, May 2023

Adrienne Begbie, ProSPa NZ

“We’ve also made it easier to make business happen with Prospa by offering all accredited and registered Prospa Partners a discounted Business Line of Credit to invest into their own business”

Adrienne Begbie, ProSPa NZ

Source: RFI New Zealand SME Banking Council, May 2023

IN Partnership with

Source: RFI New Zealand SME Banking Council, May 2023

Registered and accredited Prospa Partners can enjoy a discounted Business Line of Credit to invest in their own business

business owners/key decision-makers would consider taking out a loan with a specialised small business lender

1 in 3

of SMEs will turn to a professional for advice about their business finances

Almost a quarter

of all SMEs intend to apply for funding in the next six months

65%

SME demand for financing