Non-Depository Financing in Australia - Industry Market Research Report

Turning tides: Tighter lending standards for banks have boosted industry demand and revenue

The Non-Depository Financing industry has grown on the back of increased loan volumes. The low interest rate environment that characterised the Australian lending landscape for most of the past five years lowered profit margins for non-bank lenders, but also spurred on higher volumes of activity with many businesses and households feeling empowered to take out loans, even without deposits. Tighter lending standards placed upon conventional banks in the wake of the Banking Royal Commission have indirectly benefited non-bank lenders, with many borrowers looking to them for easier and less restricted access to loans. Strong housing market growth and capital expenditure by the private sector have driven total industry assets and performance upward over the past five years. Overall, non-bank lenders are expected to have grown at an annualised 11.2% to $22.3 billion over the period.

The industry includes financiers that lend money or provide credit to retail, corporate and wholesale customers. Financiers in the industry raise funds through wholesale channels and do not incur the liabilities of deposits. Industry operators also lease plant, equipment and machinery on a financial services basis. Deposit-taking financial institutions are excluded from the industry.

This report covers the scope, size, disposition and growth of the industry including the key sensitivities and success factors. Also included are five year industry forecasts, growth rates and an analysis of the industry key players and their market shares.