Connective Launches SME White Label Deal — Why the Business Lending Gap Is Growing and What It Means for Small Business Owners

Connective Launches SME White Label Deal with Octet — What the Growing Business Lending Gap Means for Small Business Borrowers

Australia's third-largest mortgage aggregator, Connective, has announced a new white label partnership with Octet, a specialist working capital provider, targeting the growing gap in small-to-medium enterprise (SME) lending. The deal gives Connective's broker network swifter access to business financing — a signal that traditional mortgage brokers are increasingly recognising the unmet demand for business credit.

What the Deal Means

Under the arrangement, Connective brokers will be able to offer Octet's working capital and trade finance solutions directly to their SME clients. The partnership aims to streamline access to non-bank business funding for companies that are often underserved by major banks.

Octet specialises in supply chain finance, invoice financing, and trade credit — products designed for SMEs with cash flow gaps between orders and payments.

Why This Matters: The SME Lending Gap Is Real

Australian SMEs have faced persistent challenges accessing business credit through the major banks, particularly since the post-pandemic tightening of credit standards. Key data points illustrate the gap:

• The RBA has noted that SME loan rejection rates remain elevated compared to pre-2020 levels.
• Many small businesses — especially those in retail, construction, and hospitality — hold assets but have irregular income streams that don't fit standard bank assessment models.
• APRA data shows that major bank exposure to SME lending has declined as a share of total business credit, with non-bank lenders filling the gap.

The Non-Bank Opportunity in SME and Commercial Lending

The Connective-Octet partnership is the latest example of the broader structural shift: non-bank lenders and fintech providers are actively moving into the space that major banks have vacated or tightened.

For small business owners who also own commercial property — a common profile in the Chinese-Australian business community — this trend creates both opportunities and complexity:

• Working capital vs. property finance are separate products with different risk profiles and documentation requirements.
• A business that owns its premises might need both a commercial mortgage and a working capital facility — products that different lenders specialise in.
• Non-bank lenders like MPFG Capital can assess commercial property loans under Alt Doc frameworks, looking at BAS statements, bank statements, and accountant letters rather than requiring two years of clean company tax returns.

MPFG Capital: Commercial Lending for Business Owners

MPFG Capital specialises in commercial property loans for SME owners, including:

• LVR up to 75% for commercial and retail properties
• Alt Doc assessment for self-employed directors and business owners
• Fast turnaround for time-sensitive commercial transactions
• Mandarin and Cantonese-speaking specialists in all three offices

For business owners who have been turned away by the major banks, or who need a lender that understands how SME income works, MPFG Capital's commercial lending team can provide an initial assessment within 48 hours.

Key Takeaway

The Connective-Octet deal is a market signal, not just an industry headline. It confirms what MPFG Capital has seen on the ground: Australian SMEs need flexible, broker-accessible business finance — and the major banks are not meeting that demand.

If you own a business and are looking to purchase, refinance, or release equity from commercial property, the non-bank market has more to offer than many business owners realise.

This article is general information only and does not constitute financial advice. Commercial lending eligibility depends on individual business and property circumstances.