Small Biz Buzz: Calls for easier access to finance, and a $2.5 million investment into start-ups

From the Reserve Bank finding that SMEs struggle to gain financial backing, to the Victorian Government investing $2.5 million into a new start-up accelerator; here's what making small business news this week.

Victorian start-ups have been put on a path to government procurement, thanks to $2.5 million of funding. Source: Supplied

Further calls for a small business growth fund

Small businesses and start-ups are still finding it difficult to access financial backing, according to The Reserve Bank of Australia (RBA).

The RBA’s latest report, ‘Access to Small Business Finance’ found that, without providing real estate as security, small business owners struggle to gain capital to start or grow their businesses.

The RBA statement echoes comments from Small Business Ombudsman, Kate Carnell, who is calling for a small business growth fund.

“The absence of entrepreneurial finance is damaging for small business owners, with lenders wanting real estate – normally the family home – as security,” Ms. Carnell says.

“We recommend establishing a Business Growth Fund. SMEs would be able to apply for between $250,000 and $5 million, with terms of up to seven years, secured against the business”.

Ms. Carnell wants the financial service sector to improve business relations with SMEs, to assist them to open up new opportunities.

Victorian start-ups put on a path to government procurement

The Victorian Government is investing $2.5 million to fund a new start-up accelerator, that will help businesses secure government contracts.

Led by LaunchVic (the government agency charged with developing start-ups), the investment aims to create opportunities for start-ups to provide products and services to the Victorian Government.

The CivVic Labs Accelerator will also be funded by the public sector innovation fund.

The accelerator will support 16 start-ups through a 12-week program. If successful, two additional programs will follow leading to  2020.