Risk, Assets and Capital: What’s Changing in SME Credit Markets
At our recent Brisbane seminar, Risk, Assets and Capital: SME Credit Markets in 2026, we brought brokers and finance professionals together to unpack what’s actually happening in the market and where deals are getting stuck.
The session was hosted by Nick Samios, Director at Hermes Capital, and featured insights from experienced industry practitioners Ian Hyman, Patrick Schweizer, and Mark Rainbird.
The conversation kept coming back to three core areas:
Risk. Assets. Capital.
Because in the current environment, it’s not access to capital that’s the issue. It’s how that capital is being structured and what sits behind it.
The Market Has Shifted, But Not in the Way Most Think
There is no shortage of capital in the market right now. Non-bank lenders, private credit funds, and alternative financiers are all active. But despite that, brokers are still seeing deals stall. Why?
Because credit teams are applying more scrutiny than ever.
Not just to the borrower, but to:
- The quality of the assets
- The recoverability of those assets
- The realism of the proposed exit
This is where many deals fall down. It’s not about whether funding is available. It’s whether the deal stands up under pressure.
Risk Is Being Assessed Differently
In a higher-for-longer environment, lenders are taking a more disciplined view of risk. What used to pass as “acceptable” is now being questioned.
We’re seeing:
- Greater focus on downside scenarios
- Increased scrutiny on cash flow assumptions
- Less reliance on optimistic growth projections
Credit teams are asking: What happens if this doesn’t go to plan? If that question can’t be answered clearly, the deal becomes difficult to progress. For brokers, this means moving beyond surface-level structuring. You need to be able to present a deal that holds up not just in the upside case, but in the downside as well.
Assets Matter More Than Ever
One of the strongest themes from the session was the renewed importance of asset quality. Not all security is equal, and not all assets behave the way borrowers or brokers expect when tested.
Lenders are now looking closely at:
- Secondary market value
- Liquidity of the asset
- Time to realise value
- Volatility in pricing
An asset that looks strong on paper may not perform in a recovery scenario. That’s where experience matters. Understanding how assets actually behave in the market is becoming a key differentiator in getting deals approved.
Capital Is Available, But Structure Is Everything
There’s a misconception that more capital solves the problem. In reality, poorly structured capital often makes things worse.
We’re seeing situations where:
- Multiple facilities are layered on top of each other
- Short-term funding is used to solve long-term problems
- Cost of capital erodes equity over time
This is what we refer to as capital stacking. It might provide immediate relief, but it can quickly weaken the overall position of the business. The better approach is to step back and structure capital properly from the outset.
That means aligning:
- Facility type
- Asset base
- Cash flow profile
- Exit strategy
When those elements are aligned, capital becomes a tool for growth. When they’re not, it becomes a source of pressure.
The Role of the Broker Is Evolving
One of the key takeaways from the seminar is that the broker’s role is changing. It’s no longer just about sourcing capital.
It’s about interpreting risk, understanding asset behaviour and structuring transactions that work in practice
The brokers who are succeeding in this market are the ones who:
- Think like credit
- Understand recovery scenarios
- Can clearly articulate how a deal gets repaid
Because ultimately, every deal comes back to the same question: How does the lender get paid out?
What This Means in Practice
In today’s SME credit market, deals don’t fail due to a lack of capital, they fail due to weak structure or assumptions that don’t hold under scrutiny. For brokers, the opportunity is clear. Those who can bring a more disciplined, structured approach to deals will:
- Improve approval rates
- Build stronger lender relationships
- Deliver better outcomes for clients
The market hasn’t become harder; it’s become more precise. That precision is forcing better conversations around risk, assets, and capital. Because when those three elements are properly understood and aligned, deals move.
Watch the full recording to learn more.
Interested in future seminars by Hermes Capital?
Check out our upcoming events here.