New Equifax data shows large businesses borrowing more while SMEs pull back hard. Equifax’s Brad Walters explains what’s driving the gap.
New data from Equifax shows a clear divide opening up in how Australian businesses are approaching credit. Large companies are borrowing more. Small and medium ones are pulling back.
According to Equifax’s June 2026 Business Credit Demand Trends, business loan demand across the services sector rose 0.9 percent year-on-year overall, a slight easing after a steady climb since January. Asset finance demand fell 2.8 percent over the same period. But those national figures mask a much sharper split underneath.
A Widening Credit Gap
Large services businesses increased business loan applications by 11.8 percent year-on-year and asset finance by 17.1 percent. SMEs in the same sector moved in the opposite direction, with business loans down 6.1 percent and asset finance down 13.7 percent.
Brad Walters, General Manager of Commercial at Equifax, says the pattern reflects a broader shift in how businesses of different sizes are managing risk.
“Looking beneath the surface of the Services and Production sectors, the Equifax June Business Market Pulse reveals a continuing multi-speed economy,” Walters says. “Large corporate entities continue to leverage their scale to secure capital and maintain growth, whereas small-to-medium enterprises appear to be in capital defense mode, scaling back loan enquiries and pausing equipment upgrades to preserve working capital.”
The trend held across most states, with only Western Australia and South Australia recording positive SME business loan growth, up 0.6 percent and 8.2 percent respectively. Equifax notes those two states are partly rebounding from a weaker comparison period in June last year.
Services Feel It Most
The divide was sharpest within financial and insurance services. Large businesses in the sector grew business loan demand by 16.4 percent and asset finance by 13.9 percent. SMEs in the same industry saw business loans fall 7.1 percent and asset finance drop 24.7 percent.
“In the Services sector, this divide is particularly pronounced,” Walters says. “This national pattern played out across nearly every state, with only Western Australia and South Australia bucking the trend.”
In the production sector, overall business loan demand also rose 0.9 percent year-on-year, with asset finance down 2.8 percent. Construction stood out as a sector losing momentum steadily rather than suddenly.
Construction Keeps Cooling
Asset finance demand for construction equipment grew 9.2 percent year-on-year as recently as December 2025. By February 2026 that had slowed to 7.2 percent growth, and by June it had turned negative, down 4.4 percent. SME construction businesses were hit hardest, with asset finance demand down 8.2 percent.
“Construction equipment acquisitions continue to unwind,” Walters says, “led by an 8.2 percent year-on-year drop among SMEs.”
Agriculture told a more mixed story. Large agricultural businesses increased business loan demand by 20.9 percent year-on-year, while SMEs in the same sector cut asset finance demand by 24.3 percent.
Walters suggests the pattern points to two different survival strategies playing out in the same industry. “Primary producers look to be split between offensive growth capital for scale on one hand, and short-term operational liquidity facilities on the other, deferring major equipment upgrades while utilising business credit lines to manage elevated operational and input costs.”
Agriculture Splits Two Ways
Transport told a smaller version of the same story. Large transport and warehousing businesses grew asset finance applications by 8.9 percent, largely to fund fleet upgrades, even as their business loan demand fell 7 percent. SMEs in transport saw a modest 1.7 percent rise in asset finance demand alongside a 0.8 percent dip in loans.
Taken together, Walters says the data points to a business landscape increasingly shaped by size rather than sector alone.
“As trading conditions persist through mid-2026, the gap between corporate expansion and SME conservatism remains a central theme in the business credit market,” he says. “Ultimately, while there is a noted decline in certain areas, growth is still occurring elsewhere. How Australian businesses are navigating mid-2026 is down to a mix of size, sector and geographic footprint, and on the whole, SMEs are continuing to pull back at a faster rate than large enterprises.”
Note: Figures are drawn from Equifax’s June 2026 Business Credit Demand Trends report, based on year-on-year, trading-day-adjusted data.
