Non-bank lenders are attracting nearly 11,600 loan applications from Australian businesses a month worth A$1.13 billion, according to a survey.

Online lending aggregator eBroker in a new survey finds that the wholesale trade industry has the highest demand, followed by construction and accommodation and food services. Retail trade and transport held the fourth and fifth place respectively.

“It’s no surprise that wholesale trade has the most demand for credit given that it’s the first link in the supply chain to retail, and retail itself has real issues,” says eBroker founder and chief Simon Isaacs.

The survey was conducted in the week of May 4th to May 11th 2016. All respondents were CEO’s of Australian non-bank business lenders, which included most of the emerging fintech providers servicing the SME market with unsecured business credit.

“At the moment bricks and mortar retailers are being squeezed by online competitors, and the uncertainty of the election year. They’re taking longer to pay suppliers, which explains the demand for cash flow loans amongst wholesale traders."

“This is a leading indicator of future problems hitting retail. In this sense, wholesale trade is the ‘canary in the coalmine’ for a very distressed retail sector,” he adds.

The inaugural eBroker Non-Bank Business Lender’s Survey found the average loan size was $95,104 and the average loan term 20 months. A total of 75% of the 29 lender CEOs who participated said that the demand for credit products was ‘increasing’ or ‘strongly increasing’ and no one in the surveyed group felt a decrease in the demand for their credit products. Although the survey data confirmed the rapid growth of SME demand for non-bank business credit, more lenders have ‘scaled’ faster than he had anticipated. 

Nearly 15% of lenders were receiving 2,000 applications per month. These results indicate the non-bank business lending sector is thriving, and that some providers have achieved critical mass,” says Isaacs.

The industries with the least demand for credit products were agriculture, forestry, and fishing; public administration and safety; health care and social assistance; mining; and electricity, gas, water and waste services.