Overall business credit demand grew 2.3 per cent in the three months to December compared to the equivalent 2024 quarter, according to the latest Equifax Business Market Pulse report.
Still, overall business demand was nine per cent lower than four years before, and companies' ability and willingness to take on debt depended heavily on their size, Equifax commercial general manager Brad Walters said.
"While large-scale businesses appear to be accelerating their credit appetite more quickly, SMEs (small to medium-sized enterprises) appear to be navigating a steadier path upward as they balance growth with external factors such as the pressures of inflation," he said.
"They don't always have the means to absorb potential shocks as easily as their larger competitors, so they're choosing a steadier, more sustainable climb back to the top."
The gap was clear across multiple sectors but was stark in retail, which recorded a 7.9 per cent surge in credit demand by large enterprises compared to a stagnant 0.7 per cent increase for SMEs.
However, the number of shops forced to close their doors was even more staggering.
"While we have seen strong demand growth among large retailers, the wider sector still shows some signs of pressure, with the past quarter revealing a substantial 64 per cent increase in retail insolvencies year-on-year," Mr Walters said.
In hospitality, insolvencies remained high overall but slipped nine per cent compared to the equivalent 2024 quarter, but organisations' relative appetite for credit told a familiar story about growth prospects.
Trade credit demand from large hospitality groups grew almost a fifth over the quarter, while overall credit growth from smaller players was marginal.
In construction, insolvencies remained high and relatively unchanged, while credit data showed bigger builders were confidently buying materials for their project pipelines, driving a 6.6 per cent lift in trade credit.
"During this same time period, small construction businesses appear to be avoiding broad debt, seen by a slight reduction (-0.7 per cent) in overall demand, and only borrowing for specific tools via asset finance (+4 per cent)."
Both Commonwealth Bank and Westpac last week noted they expected credit demand from businesses and households to remain resilient in 2026, despite the nation transitioning into an interest rate rise cycle.
Earlier this month, the central bank hiked rates for the first time in two years and economists believe more increases are on the cards this year, with the next most likely in May.
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