King Kong | Lowest Rate Ever | Neobank Challenge & More Finance Headlines From The Past Week

King Kong Arrives

Financial giant, American Express, is to begin offering business loans to Australia’s SME’s.

Unperturbed, by an already crowded market, AMEX will sell unsecured loans ranging from $5,000 to $250,000.

The company’s research shows a majority of SME’s are optimistic about the year ahead and two out of five will need to borrow funds this year with an average loan size around the $100k mark.

Lowest Rate Ever?

The customer owned  Greater Bank is charging full tilt down the low interest rate path now offering a one-year fixed rate of 1.60%.

For the time being, it’s the lowest home loan rate ever seen, but no one should be surprised if someone else goes lower in the current interest rate environment.

The downside is that the rate is fixed only for one year and unavailable outside of NSW, ACT and Queensland.

Lumi Cashed Up

Non-bank lender Lumi is cashed up having secured  $40 million in warehouse funds from National Australia Bank and Alexander Funds Management.

It means the company can increase the size of its loans to business and expand the maximum loan term to 5 years.

Neobank Challenge

When APRA began approving deposit-taking licences to neobanks it set a fire under the emerging sector and the pundits.

It was seen by many as an opportunity to confront the Big Four head on.  However, the demise of Xinja and the purchase of 86 400 by NAB has thrown cold water on the flames

Sydney Morning Herald writer, Clancy Yates, writes that a deposit taking licence might not be the key to neobank success.

Back On Track

The number of business loan repayments still deferred because of the pandemic has dropped dramatically.

At the peak of the pandemic, banks deferred almost one million mortgages and business loans to assist the economy during the downturn.

Australian Banking Association figures show across the nation’s seven largest banks there are now only 118,000 or 15 per cent of the loans remaining that were deferred at the peak in late June 2020.

“These are encouraging signs for the nation’s recovery,” ABA CEO Anna Bligh told AAP.