To address the growing demand among commercial brokers for enhanced expertise in working capital finance, Fifo Capital has introduced a new program tailored to brokers' evolving needs, enabling them to better serve their SME clients.
Mark Occhiuto (pictured above), head of sales at Fifo Capital, emphasised the “significant opportunity” that lies ahead for brokers who tap into the “underrepresented” working capital market.
"In the UK, approximately 60% of SMEs actively use working capital finance, while in Australia, the number is around 6%,” Occhiuto said. “This stark contrast points to the massive opportunity and need that exists for brokers to deepen their understanding of this financing method to effectively provide tailored solutions for SMEs.”
Working capital loans can be a valuable financing option for businesses of all sizes, but they are particularly beneficial for SMEs during their growth phases.
These loans can provide the necessary funds to cover essential day-to-day expenses such as inventory, payroll, rent, and other operating costs.
Certain industries, such as retail, manufacturing, wholesale, freight and logistics services, trucking, moving and storage, and service-based businesses, can reap particular advantages from working capital loans.
These industries often face short-term cash flow requirements and may need quick access to funding to capitalise on growth opportunities or navigate unexpected financial difficulties.
While working capital loans often offer flexible terms, fast access to cash, and can be used as a revolving fund facility, they do have disadvantages.
These types of shorter-term loans often have higher interest rates and lower borrowing limits compared to traditional bank loans.
However, Occhiuto said the interest you paid was directly related to the amount you utilised.
“While the rates may be higher, the actual cost depends on the usage, and the value of having access to cash on demand makes it a valuable investment for your business,” Occhiuto said.
“Also, when working capital loans are used as revolving funds, they can provide access to higher levels of financing based on the performance of your business.
“This means that as your business grows and demonstrates strong financial performance, you can tap into increased funding resources.”
By becoming an accredited broker through Fifo Capital’s new program, Occhiuto said brokers gained access to competitive commission structures and a wide range of financing solutions built to serve SME clients.
“Partnering with Fifo empowers you to enhance your client service capabilities, offering the essential insights and support required to navigate even the most intricate client scenarios,” Occhiuto said. “You’ll also get dedicated support from our team and exclusive broker resources and training.”
Fifo Capital, which helps over 3,000 SMEs with more than $2 billion in funds, developed the accreditation initiative after it launched a training program in August designed for mortgage brokers to transition into commercial lending.
That program, called the Broker Fast-Track program, acts as a bridge for mortgage brokers that have diversified into the commercial space and want to upskill in the working capital finance market.
Other prerequisites for the new broker accreditation program include:
"We know that SMEs want their brokers to clearly explain loan options and better understand their needs and goals. That's why we work closely with our brokers to help them assist their clients in finding the right solutions for their needs. It's a win-win."
Aside from the new programs, Fifo Capital has bolstered its presence, establishing a local corporate office in NSW to expand its funding offerings and better serve businesses in the region.
New senior business development manager Brandon Robins will lead this corporate model expansion in the state.
To join Fifo's Broker Accreditation Program, visit https://fifocapital.com.au/brokeraccreditation.
