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[MoreMore Insights] Big Four Banks V.S. Small Lenders

When we apply for a loan, there are many loan institutions in the market for us to choose from, including the four big banks and other small lenders.

Big Four Banks

As we all know, the four big banks in Australia are CBA, NAB, Westpac, and ANZ bank. The big four banks in Australia are actually among the most profitable banks in the world. Together, they accounted for a huge 80% mortgage market share back in 2012. But now in 2022, that has reduced to less than 70% with the smaller banks making a significant resurgence and the rise of new banks also taking a share.

Other Small Lenders

The Small Lenders are referred to as the second-tier lenders. These include La Trobe, Suncorp bank, Bankwest, ING, ME bank, CitiBank, just to name a few. Compared to the big four banks, those smaller lenders find alternative ways to appeal to new customers, such as better credit policy.

Branch Networks

One of the primary reasons many people choose to stick with the big four banks is the convenience of local branch networks. Small Lenders may only have branches in major cities and towns. This means customers have limited or even no access to branches. This can be an inconvenience, but the popularity of online banking is weakening this inconvenience.

Lending Products

The big four banks have many branches and employees, so they can provide more comprehensive banking products and services. Although they have higher operating costs, big four banks also have a large number of existing customers, which often means that the products and services provided by the four major banks are quite competitive. Smaller lenders are different, as the lower operating costs enable them to provide the same level of competitive products.

Approval Times

The big four banks have a large number of back office resources and mature process approval team, so generally speaking they can quickly evaluate and approve home loan applications. Small lenders often take longer to complete the approval process due to a lack of staff.


Small lenders can usually provide sufficient flexibility in loan policies, security types and fees to provide customers with more lending choices. The big four banks cannot be as flexible as small lenders.

In Conclusion

Big four banks and small lenders have definite pros and cons. Therefore, the best choice should be evaluated according to your personal position. Contact your mortgage broker to help you choose the right lender and product.

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