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The key to this evolution? Tapping into the vast and lucrative world of SME lending.
In a recent episode of Finance Specialist, co-host and Accendo Financial’s partner, Trent Carter, unpacked the compelling opportunities and strategies for brokers in the SME space.
The consensus was clear: brokers who overlook this sector are missing a significant growth engine.
The SME client: A deep and profitable relationship
The core advantage of working with SME clients is the shift from a single transaction to a continuous relationship.
“For every one transaction that you do for your PAYG client, you wait four and a half years and you do another one. Versus you do something for an SME, likely within six months you can do something else for them. So, they become deep, profitable relationships,” said Carter.
SMEs are dynamic – they constantly need to invest in their businesses. This could mean financing new vehicles, upgrading plant equipment, purchasing commercial property, securing cash flow funding, or managing insurance premiums.
By becoming a one-stop shop that can address all these needs, a broker transforms from a loan facilitator into an indispensable trusted adviser. This creates what Carter calls “sticky clients” – relationships built on holistic service rather than just price, making them more valuable and loyal in the long run.
The hidden link: Investors are often SMEs
A crucial insight for brokers already working with property investors is that these clients are frequently self-employed business owners.
“A big chunk of investors are typically self-employed as well,” said Carter.
“One thing we know about self-employed people is they’re not always the best at paying themselves super. But they do buy investment properties. They buy their own commercial properties as an investment that they can operate their business from.”
This means your existing investor clientele is a natural gateway into SME lending. By recognising this connection and initiating deeper conversations, you can unlock a suite of new services for clients you already know.
Where are the opportunities right now?
Carter highlighted several industries currently primed for growth and investment, presenting ripe opportunities for brokers:
- Mining: Businesses that support mining operations – be it transport, equipment, manufacturing, or accommodation – are showing strong growth, particularly in Western Australia, Queensland, and South Australia.
- Health and aged care: Driven by an ageing population, demand for healthcare services is booming. A specific emerging trend is the rise of “at-home care” services, which require capital for recruitment, vehicles, and operational expansion.
- Childcare: The sector is supported by significant government investment and a solid business case, leading to expansion and acquisition opportunities.
- Agriculture: While breaking into farm lending itself can be challenging as it requires expertise, brokers can look to businesses that support agriculture – transport, grain supply, fertiliser, and labour providers.
The advice was to follow the money. Government budgets, grants, and incentives are strong indicators of which sectors are poised for growth and will likely need financial support to expand.
Slow down to speed up
Jumping into SME lending without a strategy is a common pitfall. Carter emphasised the mantra of “slow down to speed up.”
The role of the broker is shifting from pure facilitation to expertise. In an age where AI can handle basic loan processing, the human value comes from solving complex problems.
“What’s going to set you apart is being that expert, being able to resolve the deal that isn’t vanilla, and being able to work with people and find the right answers when they can’t get the right answer,” Carter said.
Carter urged brokers to pick a niche, do their homework, and become a trusted adviser.
The message for brokers is clear: diversification into SME lending is no longer a niche strategy – it’s a business imperative for sustainable growth.
By developing expertise, understanding the deep connection between investors and business owners, and focusing on building holistic, service-based relationships, brokers can future-proof their businesses and unlock a powerful new revenue stream.
[Related: Finance Specialist: The lucrative opportunity of SME diversification]
