Businesses are continuing to invest in their operations despite the slower economy, with data from the Commonwealth Bank of Australia’s business bank showing a 15% uplift in vehicle and equipment financing compared to the same period last year.

Motor vehicle purchases have been a key driver (up 55%), as supply chains continue to improve post-COVID and new stock becomes available. Among this category, loans for hybrid vehicles increased fivefold (533%) in the past financial year, and electric vehicles were up 254%. Financing for light commercial vehicles such as utes, vans and light trucks – a category that is particularly popular with small business customers - rose 27%.

Businesses are also investing in shop and office fit-outs, with financing for shelving and furniture fittings up 25%. Financing activity has been particularly strong in areas like health and community services (up 35%), education (up 24%) and manufacturing (18%).

Grant Cairns, executive general manager of business lending at Commonwealth Bank said: “Australia’s economic fundamentals are sound, and there are reasons for optimism about the future, but inflation and other global risks contribute to uncertainty that’s rightly prompting business owners to take steps to ensure their operations are future-fit and resilient.”

Cairns said: “While companies are navigating ongoing pressure from the rising cost of doing business, we are seeing many business owners taking the long view on the economy and investing in their operations.”

As motor vehicles are one of the most common asset investments for small and medium-sized businesses, CommBank has collaborated with Carsales to launch a car buying service via the CommBank app or Netbank to help make finding and financing a car or electric vehicle easier for both business owners and individuals.

“We are very focused on ensuring access to capital to help drive productive capacity across the country,” Cairns said.

“For small and medium-sized businesses, this means making it simpler and easier to access funds and we’ve cut our funding time-to-decision by 20% to provide that support faster.”

Cairns said the bank has also worked to automate and digitise its business lending products, including business overdrafts, which are now available to eligible small business customers via a fully automated online application process that can see funds credited to their account in as little as eight minutes.

Still, Cairns said, while many businesses were looking to invest, that wasn’t the case for all, and some businesses were doing it tough amid higher cost of living.

“While there are these pockets of strength and optimism across the economy, we know that the economic climate is challenging some businesses more than others, and we have tailored support available for those who are doing it tough.

“We have been proactively reaching out to hundreds of thousands of our business customers to check in on them and ensure that those who need support know how to access it and understand what measures are available and that we’re here to help,” he said.

CBA has a range of measures available for those who need support including deferred business loan repayments or debt restructuring.

Re-disseminated by The Asian Banker