 Favoring home lending means less credit to allocate to business.
If banks continue favoring the homeloan sector over lending to business, it would weaken economic growth in the long run, according to NAB.
Meanwhile, according to Joseph Healy favoring home lending may mean less credit to allocate to business.
"This is ultimately bad for growth, bad for competition, bad for jobs, bad for business and in the end bad for Australia,'' Healy adds.
According to the Australian Financial Review NAB denies the reports that the discounted standard variable rate is funded by higher business loan rates while it seeks to boost mortgage market share.
A recent survey by JP Morgan and Fujitsu Australia reveals that small businesses would continue to endure the impact of higher funding costs while pressure on banks intensified.
Almost 90% of all lending to small and medium-sized businesses comes from the major banks, with NAB’s share at 26%, Westpac/St.George at 25%, CBA at 24% and ANZ at 15%.
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