How this lender is helping SMEs combat stress

Non-bank lender Banjo Loans has highlighted some of the tools that small and medium-sized enterprises (SMEs) can use to traverse through a challenging economic environment.

This comes as recent findings from a major bank have shown high levels of stress among small-business owners during the ongoing cost-of-living crisis.

The research, commissioned by the Commonwealth Bank of Australia (CBA), highlighted the significant stress, showing that 52 per cent of business owners and senior managers have experienced a negative impact on their mental health over the past 12 months due to the challenging economic climate.

The research also uncovered that nearly two-thirds (65 per cent) of the surveyed businesses had to manage unexpected expenses in the past year, amounting to a staggering $7.3 billion in unforeseen costs.

On average, these businesses have had to cover around $4,300 in unexpected expenses.

The most frequently encountered unexpected costs were equipment repairs and replacements (48 per cent), higher supplier costs (33 per cent), and increased utilities costs (32 per cent).

Despite these findings, Banjo’s head of collections Tim Morosoli said SMEs should not be afraid to contact their lender when such unforeseen costs arise.

“Understandably, people hate talking about their business having problems,” Morosoli said.

“The job of the lender’s Collections team is to make square pegs of debt fit round holes of payment.”

Morosoli said that lenders such as Banjo are “focused on solutions, not judgement”.

“We take a realistic approach, aiming for something that the customer can achieve. There’s a suite of options, such as restructures, delayed payments, extended loan period and so on,” Morosoli said.

Morosoli, drawing on his 35 years of experience in this field, said that maintaining healthy repayment habits on business loans is “crucial for any business’ long-term success and financial health”.

Open and honest communication carries strong benefits, from maintaining trust and avoiding legal consequences, to reputation management and strategic planning, according to Morosoli.

“I can’t stress enough – pick up the phone and talk to the lender. The sooner you do it, the less stress it’s putting on you, and the faster a solution can be worked out. It’s more than likely there will be answers that you haven’t thought of,” Morosoli said.

“Most of all, the lender will be happy that you’re proactively discussing your financial challenges.”

[RELATED: Economic climate impacting the mental health of over half of SME owners]

Adrian Suljanovic is a journalist at Broker Daily with more than two years experience reporting on all facets of the third party distribution channel.

Adrian has written for a range of business and finance titles including IFA, Investor Daily and Lawyer’s Weekly before joining the mortgages team in 2022.

He graduated from the University of Wollongong in 2021 gaining a Bachelor of Communication & Media with a major in Digital & Social Media.

E-mail Adrian at: This email address is being protected from spambots. You need JavaScript enabled to view it.