A BENDIGO business leader is concerned economic growth could be hindered by a tighter lending environment.
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Be.Bendigo chief executive Dennis Bice has raised concerns that businesses may be finding it harder to access capital, which could have a flow on effect to the city's economy.
Mr Bice said banks had tightened lending, both for home loans and small businesses, in the wake of the royal commission into banking misconduct.
He said he had spoken to some businesses in Bendigo - both small and medium scale - that had found it difficult to access funds.
Mr Bice said he did not know whether it was affecting businesses more broadly than those he had spoken with.
But if businesses found it hard to access capital, it would slow growth ultimately affecting employment, Mr Bice said.
While lending has tightened, interest rates sit at the unusually low level of one per cent.
Mr Bice said there was still opportunity, but he wanted to make sure businesses kept access to capital.
LaTrobe Business School's Earl Jobling said the changes brought by the royal commission were a new environment, to which businesses would have to adapt.
"The royal commission has brought about a tightening of lending standards. But at the same time interest rates are incredibly low," Mr Jobling said.
"If businesses can make the business case that they can service a loan, it should be okay."
Australia's gross domestic product figures released on Wednesday show record-low economic growth, of just 1.4 per cent through the year.
Mr Bice said this low growth probably meant businesses in Bendigo would be a bit more cautious. He said retail enterprise in particular was finding it difficult.
In contrast, areas like construction and manufacturing were performing strongly, Mr Bice said.
"There are different parts of the business economy that are going really well and that are outperforming, there are certainly parts of businesses that are struggling at the moment," Mr Bice said.
Mr Jobling said it was too early to say what low growth would mean for Bendigo.
He said while the GDP was not as high as would be ideal, the fundamentals of the Australian economy were strong.
Bendigo had a diversified economy, which meant it was in a strong position, Mr Jobling said.
Red Lion Advisory manager of business services and taxation Hayley Hendrix said a weak economy meant people were more likely to be conservative with their spending.
But low interest rates meant people were saving on their mortgage, while tax cuts had been put in place to encourage spending, she said.
Ms Hendrix said local businesses may see a small downturn in their income, but it was more likely a dip.
She said she expected tax cuts to eventually encourage people to spend more, in turn increasing local business activity.
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