In the lead-up to the release of the NSW Annual State Budget the NSW Treasurer was reported as describing the current environment as having ‘economic uncertainties’. After several years of pandemic-related issues and now dealing with surging inflation, supply chain disruptions, energy issues and price rises, that would not come as a surprise description. While the euphoria of being out of lockdown has now worn off, the reality of the economy bouncing back is being realised. For many enterprises, the support from affordable business finance is essential.
It can be extremely important for business growth, productivity and profitability for business to access affordable, workable and flexible business finance. Access to specialist sources of finance and professionals to assist with the entire process either as a one-off loan application or with ongoing finance solutions are available to all types of businesses.
Through our broker-style services, micro businesses through to large corporations have access to specialist finance to support their operations through good and challenging times to specifically achieve target outcomes.
Addressing Current Economic Conditions
The current economic conditions will be creating different trading conditions and prospects for different businesses. This may be dependent on the industry sector, the state or territory of operation and many other factors.
But what all businesses seeking finance should comprehend is the overall economic environment and the factors which are influencing interest rates. In Australia, the RBA focuses especially on the unemployment figures and the rate of inflation when making cash rate decisions.
In May we saw the RBA lift the cash rate by 0.25% and in June by 0.5% to the current 0.85%. Inflation is continuing to surge with the RBA first having 6% by year’s end as its outlook at the 7 June meeting only for Governor Lowe to revise that to 7% just days later.
Unemployment has been falling and sits currently at the 40 year low of 3.9%. This reflects the tight labour market, partially due to the labour market being closed to international workers over the years of the pandemic.
These two issues in conjunction with global impacts and other factors, point strongly towards another significant increase in the cash rate at the RBA’s 5 July Board meeting. The RBA has indicated that it sees further increases in the cash rate as required in the time ahead to return inflation to its target range of 2-3%.
Businesses can take heed of the RBA outlook and the strong indication of further rate rises by proceeding swiftly with purchases of motor vehicles, trucks and equipment with finance. Increases in the cash rate flow through to the business finance sector as banks and non-bank lenders lift their rates as a result of their lending costs increasing with the cash rate.
While the increases may appear small, 0.25-0.5% so far, that can equate to significant increases in total interest payable on finance over a 7 year term and can be a not inconsequential increase in monthly loan repayments to meet each month.
So moving quickly, if possible, is highly recommended. Your Jade Finance consultant will support you with quick quotes and fast approvals to expedite the finance process.
How Specialist Business Finance Works for Business
While some businesses may feel that they have the ability and the time to source their own finance, utilising specialist services can deliver significant benefits. Our consultants are experts, we have industry-level access to lenders which is not available direct to businesses and we have access to a large number of lenders. So we know exactly which lender would best suit our customer and we know which lenders are currently offering the best interest rates.
Many of our non-bank lenders are specialist in either particular industries or for particular goods such as truck or equipment finance. This speciality can deliver benefits through their in-depth understanding of the sector when it comes to loan conditions and of course, interest rates.
Rather than a one size fits all approach to business finance support, we offer a full range of loan types to target specific pain points. This allows businesses access to exactly the type of finance which is designed to meet the objective.
Objectives such as cash flow shortages, non-asset acquisitions and purposes, dealing with slow-paying customers and managing large insurance premiums. All finance requests and applications are dealt with on an individual basis. Loans are individually sourced, negotiated and structured to specifically meet the requirements of that enterprise.
Specialist services can be of particular importance to relatively new and start-up businesses requiring Low Docs and No Docs finance.
How to Access Cheaper Finance Solutions
Our services are available to all businesses on a one-off loan basis or to establish an ongoing working relationship to address recurring and emerging finance requirements. Business operators from across Australia can utilise our services as all arrangements and communications are made via phone and email. For total remote and contactless communications. Ensuring a streamlined and time-saving delivery of cheap interest rate business finance.
The current finance outlook is for interest rates to continue to rise with the cash rate to rise from today’s 0.85% to possibly 2%. This is in itself a compelling reasons for businesses to prioritise securing cheaper and more affordable finance to support their operation as the economy readjusts to post-pandemic interest rates and the RBA normalises monetary policy.
Contact Jade Finance 1300 000 008 to discuss how we can assist your operation with affordable business finance.
DISCLAIMER: NO LIABILITY IS ACCEPTED IF ERRORS OR MISREPRESENTATIONS ARE FOUND IN THIS ARTICLE. THE ARTICLE IS PREPARED AND PRESENTED FOR GENERAL INFORMATIVE PURPOSES AND IS NOT INTENDED TO BE THE SOLE SOURCE OF INFORMATION FOR MAKING FINANCIAL DECISIONS. THOSE REQUIRING GUIDANCE AND ADVICE SHOULD CONSULT A FINANCIAL ADVISOR.