For small and medium-sized businesses, this is an important extension of the trend we discussed after the April figures. Businesses are still seeking finance despite elevated rates, which suggests many owners are not simply borrowing to plug gaps. Some are funding equipment, stock, vehicles, technology, expansion plans or seasonal working capital while competitors remain cautious.

That does not mean approvals are easy. In a higher-rate environment, lenders are still paying close attention to serviceability, cash flow, tax debts, repayment conduct and the purpose of the loan. Strong demand can also make the market more selective. Businesses that prepare early, keep financial records current and understand their repayment capacity are likely to be better placed than those applying at the last minute.

The data also shows personal credit rising 0.6% in May and 4.4% over the year. That points to continued use of personal finance for cars, renovations, debt consolidation and major purchases. However, borrowers should be careful not to focus only on the headline rate. Fees, comparison rates, early repayment rules and loan flexibility can materially change the real cost of finance.

Housing credit remains larger overall, but its monthly growth was softer at 0.5%, with annual growth of 7.5%. The contrast matters because it shows business lending is still a key source of momentum in the credit market. For lenders, that may support more competition in selected commercial finance niches. For borrowers, it reinforces the value of comparing structures, not just providers.

Before applying, SMEs should clarify whether they need a term loan, line of credit, equipment finance, vehicle finance or an unsecured facility. The right option depends on the asset being funded, the repayment timeline and how predictable future cash flow is. It is also sensible to model repayments under different rate and revenue scenarios before committing.

As business borrowing continues to climb, the message is not to rush, but to be ready. A well-prepared application, clear funding purpose and the ability to compare finance options can make a meaningful difference when lenders are balancing strong demand with tighter credit assessment.