FinTech Australia, the Australian Small Business and Family Enterprise Ombudsman (ASBFEO), and theBankDoctor.org have released a joint report on fintech business lending.
The report includes the results of a survey of SME lenders that found 74 per cent offer a fixed term unsecured loan, 32 per cent offer invoice financing, and just 5 per cent offer interest-only loans or overdraft facilities.
Attached to the report is a glossary of common terms used by the fintech business lending sector – an initiative of FinTech Australia that was agreed to at a roundtable conducted on 13 December 2017.
The roundtable also resolved to form an industry working group that would develop a code of conduct by June 2018 to cover fintech balance sheet lending.
The report included key pillars for future "industry self-regulation and action", including action to comply with the Unfair Contract Terms legislation; support of internal and external dispute resolution services; and measures to work with governments on policymaking to support fintech business lending.
Commenting on the report, Spotcap managing director Lachlan Heussler said it was an "important first step on the road to self-regulation".
"For many years, we have spoken of our commitment to transparency, regulation and responsible lending, backed up by policies and practices – such as transparent fee disclosure, a loan calculator and readily available customer support – which ensure our SME customers can make informed decisions about our business loans," Mr Heussler said.
"At the same time, we recognised that a consistent, industry-wide approach was needed and, as such were excited to join a working group to create something sustainable to the benefit of the SME community and the broader Australian economy," he said.