Demand for business banking products has dropped significantly over the past four months, with commercial banks including the Big Four local providers as well as regional and international banks all reporting a downturn in demand.
According to the latest East & Partners Advocacy Monitor, for the period between March and July this year, every bank has experienced a fall in demand for business banking products.
Of the Big Four local banks, Westpac and National Australia Bank have experienced the biggest drops, seeing a decline of 3.6 and 2.6 percent respectively.
All regional banks have reported a demand downturn, with research finding Citi Bank and Suncorp were the most affected with a fall of 3.6 and 3.8 percent respectively.
East & Partners found the trend was evident across all business segments, from micro businesses to the mid-corporate sector. SMEs reported the biggest drop in demand over the four-month period however, with a 4 percent decline, whilst the market at large has seen a total demand fall of 3.1 percent for business banking products.
The decline is being attributed to a number of key issues currently impacting businesses, including a lack of proactive engagement from providers with business customers, as well as confusing communications.
Other factors include a general fragility in business sentiment, lack of clarity around near-term economic conditions and businesses outside the resources sector not investing for business growth.
