ANZ has made a pledge to lend AU$1 billion to startups and small businesses as part of its Banking on Australia program.
Making the announcement in Sydney on Tuesday morning, ANZ general manager of Small Business Banking Nick Reade said it is a myth that banks do not lend to small businesses, and that it is seeing significant growth in serving these customers.
"A lot of new small business owners think that it's only big businesses that get loans from the banks, but that's not the case. In the last year, we approved more than seven out of every 10 lending applications from new small businesses," he said. He added that when he began in ANZ's Small Business Banking division five years ago, its team only consisted of 100 national staff members. Today, it consists of about 800.
According to a spokesperson for the bank, the pledge represents a 30 percent uplift on the amount it loaned small businesses last year.
Currently, around 10 to 15 percent of ANZ's small business lending goes to businesses in the online space, and Reade expects it to grow quickly.
"It's Web 2.0, mobile-based types of companies. It's typically young, youthful, high-energy [entrepreneurs], and looking to take their business to the next level."
Also speaking at the launch, small business coach Robin Dickinson offered startups a caveat for those that are thinking about diving into the financial opportunity to escape their day job.
"There's a love affair with the big idea, [and] when they become emotionally attached, they become blind to the commercial reality and the practicality — the numbers, as they say — that can actually make that work. First and foremost, have that ability to be objective about it," Dickinson said.
"[Some see] going into your own business as an escape from something that hasn't worked. In your own business, particularly in this economic climate, that just isn't a good enough reason. The numbers have just got to work."