NEW KEY TO EQUIPMENT FINANCE
Written on the 13 September 2012
A BRISBANE commercial borrowing brokerage hopes its new loan comparison website will encourage greater transparency.
Finnovate will become the largest webbased equipment finance comparison service, if owner Chris Beath (pictured) has his way.
The start-up, a subsidiary of equipment finance brokerage A Class Business Finance (ACBF) hopes to capture a 5 per cent share of Australia’s $36.7 billion business finance market within the first five years with a longer-term goal of securing 10 per cent.
The website helps borrowers compare equipment-finance offers from Suncorp Bank, St George Bank, Capital Finance, Macquarie Bank, Bank of Melbourne, Bank of South Australia, Bank of Queensland, Westpac Banking Corporation and the Australia and New Zealand Banking Group.
“We only want to deal with top-tier financiers and have no desire to step into the second-tier financier market,” says Beath.
“We offer a niche service because commercial equipment finance rates are not collectively advertised elsewhere. Other finance comparison websites are mostly consumer-based and do not offer equipment finance.”
The website provides comparison tools for automotive finance and can even be used as a direct-to-market resource for financiers.
“Equipment lending has operated in a similar fashion for the past three decades. The next generation of business owners want to revolutionise how they apply, compare and refinance their equipment lending needs,” says Beath.
“Unlike mortgage financing which operates to a fairly homogenous interest rate model, it is widely acknowledged that rates offered to Australian businesses for equipment and vehicle finance transactions are far more variable and more difficult to compare on a like-for-like basis.
“We see increasingly more customers looking to make their own decisions through online research. They want access to this information at all times, seven days a week on their smartphones, PCs or tablets.”
Finnovate has set growth targets of at least 50 per cent, which Beath describes as “achievable” in the 2013 financial year.
“We will focus heavily on market penetration, sales and marketing activities. Advertising will play a part, from which we will see some organic growth,” he says.
“We have appointed Maria Salcedo as full-time social media and marketing specialist to engage in direct and real-time communication with customers. We want two-way conversations instead of a hardsell approach.”
The employer of four staff uses social media to provide updates on Reserve Bank of Australia interest rate decisions and broader trends. Its Facebook page was launched in mid-July but has already attracted more than 100 likes.
Beath hopes his service will help end what he calls a “lack of competitive pressure” in the small-to-medium enterprise loan market.
“Lenders keep their rates very close to their chests and borrowing insight has suffered because of this,” he says.
“Finnovate totally changes the game. We are fighting hard for Australian business by introducing greater transparency in this space.”
The website allows online finance application process for transactions worth up to $1 million, while deals exceeding the threshold are handled directly by Finnovate.