Access to finance and competition in banking have been hot topics for smaller operators and policy reveals like the small business securitisation fund have aimed to boost the fintech sector's ability to loan out capital. Loading Whether opening up banking will actually lead to better outcomes for small businesses remains unknown because it's hard tell whether it will drive better lending and product deals alone, says independent banking consultant Neil Slonim. "My own view is that anything that makes it easier for small business owners to access finance is to be applauded... but I think it's complicated. Unless you're on the inside, it's pretty difficult to understand what it will mean for SMEs." The fintech space has long championed the open banking regime as a way of allowing challenger banks and lenders to build new banking products. "I think you’re going to see faster loan processing, pre-qualifying of income and things like that. I think you're going to see things like faster accounting," founder of comparison platform Finder.com.au Fred Schbesta says. The timeline of open banking is also still an unknown though, with the federal government having to wait until the new parliament resumes to pass legislation for the 'Consumer Data Right', which would pave the way for the future rollout. "The biggest roadblock here is uncertainty. We need a clear timeline to open banking implementation that the industry can plan for. The current rollout date is February 2020, and the industry is working towards that," general manager of FinTech Australia Rebecca Schot-Guppy says. Co-founder of marketplace payments company Assembly Payments, Victor Zheng, says once the policies are in place they will change how financial institutions work together. "An interesting consequence of it is that we believe it will encourage our major banks to form stronger partnerships with local fintechs," he says. Even if these changes are the result, it's unclear whether the regime will lead to better lending or account options for small businesses, Nicholls says. Some fintechs currently loan money at a significant premium to the banks' standard offers. "What small business needs is effectively relatively reasonable lending rates that are secured by something other that their principal residence," Nicholls says. Even with the business securitisation fund on the horizon, Slonim says many small businesses find it hard to understand the complicated nature of these policies. "It’s confusing for all of us: the good thing is there seems to be action being taken." Follow MySmallBusiness on Twitter, Facebook and LinkedIn. Emma is the small business reporter for The Age and Sydney Morning Herald based in Melbourne.
The introduction of open banking initiatives in Australia may not see small businesses reap any initial benefit , commentators have noted . Australia 's largest banks will be introducing open banking measures in July , the first phase of a two - year roll - out which will see consumer banking information shared between financial institutions . The goal is to enhance transparency and provide more personalised products to consumers . It has been mooted that small businesses will benefit from better access to financial services . The immediate beneficiaries of the new rules , however , are likely to be consumer banking professionals , according to commentators .