BEHIND THE NUMBERS: Bracing Australia’s backbone

ANZ’s history is intertwined with Australia’s small-to-medium business (SME) sector. In the 1830s SMEs spurred the growth of Australia’s financial industry - and ANZ - when wool was in high demand from England’s textile mills. Today includes businesses from sole traders to bakeries to specialist manufacturers.

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Australia’s small to medium business sector is the backbone of the country’s economy.

It’s always been a major thread of our business – but in recent times it has not been a distinct division, rather it has been combined with our Retail business. This meant our Commercial business didn’t have the focus or indeed the resources to evolve in-line with customer needs.

To address this, Commercial Australia became a standalone division in March this year. This will also better prepare us and our customers for future growth opportunities.

"We’ve defined a clear, customer focused strategy so we can continue to support the evolving needs of SMEs looking to start, run or grow a business. It involves simplifying and innovating our products, platforms, and policies so we can quickly anticipate and respond to customer needs.”

Our first results earning figures, which we’ve compared with like-for-like numbers from 12 months earlier, demonstrate this was the right decision for the business.

We increased cash profit by 36 per cent to $1.5 billion and revenue by 18 per cent to $4.4 billion – a quarter of group revenues - driven by volume growth and disciplined margin management.

The business grew net lending assets by 4 per cent with solid lending growth in specialist segments including agribusiness and health.

But we know we can do more. Our customers have told us:

  • ‘Having all my banking with one bank makes my life easier…’
  • ‘Starting or growing a really small business is one of the hardest things to do…’
  • ‘I want quicker, more personalised service…’
  • ‘I appreciate bankers who understand my business…’

Customer focus

We’ve defined a clear, customer focused strategy so we can continue to support the evolving needs of SMEs looking to start, run or grow a business. It involves simplifying and innovating our products, platforms and policies so we can quickly anticipate and respond to customer needs. This includes a focus on data and digital technology to deliver more personalised customer service.

By understanding customer needs and responding quickly we help enhance customers’ financial wellbeing and provide an improved customer experience across our banker and broker network.

These changes will benefit our around 630,550 Commercial customers across all industry sectors and we’ve identified specific ways to further support micro businesses and our Commercial customers who seek a home loan or have a home loan elsewhere.

We’re making strong progress having introduced and expanded several digital-first, banker-supported platforms. Our online business lending tool, ANZ GoBiz, uses customers’ accounting software to pre-validate and automate unsecured overdraft applications up to $300,000 and term loans up to $500,000, with lending approvals issued in less than 48-hours. This has enabled customers to manage cash-flow and grow.

Planning is now underway to expand GoBiz to a broader set of Commercial customers and lending products including business credit cards and broker originated lending.

In an industry first, we’ve also made it easier for new and existing sole traders to open a business transaction account using just a driver's licence or passport and an ABN through ANZ’s app without visiting a branch or having to wait for their details to be verified. This has led to close to 4,000 business transaction app-enabled account openings and helped drive an almost 16 per cent increase in digitally originated business transaction accounts in the 2022 financial year.

Access to the right finance at the right time is critical for SMEs and these platforms provide customers with a quick indication of our lending assessment allowing them to make informed business decisions.

Creating efficiencies

Several enhancements across credit, operations and distribution have improved efficiency across our lending process. This includes a simplified refinance process for business lending up to $1 million for eligible customers, creating quicker loan approvals and access to appropriate capital. As a result, we’ve seen a material reduction in the average credit decision timeframes for small business customers.

The introduction of market leading technology will be driven by partnerships including our joint venture between ANZ and global payments services leader Worldline, the first partnership in Australia between a big four bank and a specialist payments provider.

Through this joint venture, which commenced in April this year, Australian merchants will have access to some of the world’s most advanced payment solutions, proven internationally and adapted to meet the unique requirements of the Australian market. This will make it easier and faster for SMEs to accept payments by using their customers' preferred payment method.

This is especially important in a market with accelerating take-up of digital payments technology and an increasing shift to electronic payments, including payments made online and using mobile devices.

The road ahead

Australia’s small to medium business sector is the backbone of the country’s economy but it was also a sector placed under enormous pressure during the COVID crisis.

What was consistent with businesses able to manage through was their early action and engagement with their bank. Our bankers supported customers with arrangements such as loan deferrals, overdrafts to assist customers enrolled in the Government’s JobKeeper program pay wages, and funding to almost 15,700 customers under the Government’s SME Guarantee Scheme (GGS). GGS was also provided via ANZ GoBiz making ANZ the only major bank to offer the funding via a digital channel.

Although conditions have clearly improved, the road ahead could present new challenges for SMEs including higher interest rates, rising inflation, slower growth and an economic downturn which could impact both domestic and global demand for many of the services and products supplied by SMEs.

Thankfully businesses are well prepared, and we will continue to work closely with customers to support them during times of uncertainty. Our recently launched Financially Ready Hub provides insights and tools that can help businesses navigate a range of conditions.

We’re proud of Commercial Australia’s performance and the progress we’ve made in building a digital and data driven business. In the year ahead we will appoint a Group Executive to run the division and concentrate on continuing to grow a high-quality and diversified customer base.

Shayne Elliott is CEO of ANZ


On December 9 ANZ announced Clare Morgan’s appointment as Group Executive Australia Commercial, reporting to CEO Shayne Elliott. As a member of ANZ’s Executive Committee, Morgan will be responsible for ANZ’s commercial business in Australia where she will lead a team serving customers ranging from sole proprietors through to emerging corporates as well as Private Banking.

Morgan has extensive financial services experience across a variety of business and institutional banking sales and product roles in Australia and the United States. Most recently she worked at Commonwealth Bank of Australia as Executive General Manager of Small Business Banking.

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