The ASBFEO’s ‘Affordable capital for SME growth’ report was hailed by the IPA for reinforcing many of the sentiments it has held in the past around small business financing.
IPA chief executive Andrew Conway said the recommendations are very consistent with the contents of its Australian Small Business White Paper, which he says will be reiterated in its next edition.
“The next edition of the white paper, which incorporates new research conducted through the IPA Deakin SME Research Centre, will reinforce the access to finance problems that so many small businesses face every day,” Mr Conway said.
“Australia must do everything in its power to support small business productivity and growth for the sake of our economy.
“Facts borne from the ASBFEO report such as small businesses’ 57 per cent contribution to GDP and the employment of seven million people says it all.
“Our research confirms that small business continues to have problems with access to finance and capital; critical elements to support healthy cash-flow that underpins growth opportunities.”
Further, Mr Conway said it was pleasing that ASBFEO included a recommendation for a government guarantee scheme.
He believed a loan guarantee scheme would help increase the availability of much-needed, affordable loan finance to the small business sector, further adding that Australia is one of the only countries in the developed world without such a scheme.
“A limited state-backed guarantee would encourage banks and other commercial lenders to increase loan finance available to small business at affordable rates,” Mr Conway said.
“Access to responsible and affordable finance will help many small businesses reinvest in their businesses and help create new ideas, new capacity and new jobs.”
