- Overall business credit applications rose 1.5% for the December quarter 2014 (vs December quarter 2013)
- Modest growth in business loans (+2.9%) and trade credit (+1.8%), although the rate of growth eased
- Asset finance declined slightly (-1.1%) (vs December quarter 2013)
The Veda Quarterly Business Credit Demand Index, measuring applications for business loans, trade credit and asset finance, rose at an annual rate of 1.5% in the December 2014 quarter.
The increase is reflected in modest rises in business loan applications (+2.9%) and trade credit applications (+1.8%), partially offset by a slight fall in asset finance applications (-1.1%). The moderate increase in overall business credit applications in the December quarter shows an easing in the rate of growth from the September quarter but is in line with the 12 month trend. Veda’s General Manager Commercial Credit, Moses Samaha, said: “During the September quarter, factors including low interest rates, the falling Australian dollar, increased marketing by major credit providers and a more settled ‘post-budget’ business outlook created a sharp upswing in business credit demand. By contrast, the December quarter shows a levelling out of business credit demand, and is on par with the average rate of growth over the past five quarters.”
The Veda Quarterly Business Credit Demand Index measures the volume of credit applications that go through the Veda Commercial Bureau by credit providers such as financial institutions and major corporations in Australia. Based on this it is a good measure of intentions to acquire credit by businesses. This differs to other market measures published by the RBA/ABS, which measure new and cumulative dollar amounts that are actually approved by financial institutions.
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Source: Veda Press Release