Signs are showing in the ASBFEO Small Business Pulse that 2026 can be a year of renewal, reinvigoration and reinvestment for the sector. The February Pulse increased by 0.1% in the three months to February 2026, marking the fourth consecutive quarterly increase. This rise reflects self-initiated ambitions of enterprising small business owners who continue to show strong intent to build and transform.

Getting paid by a business customer is still the most common reason the Ombudsman is contacted for assistance. Increasingly, small businesses seeking help to get paid worry that the business that is not paying them in a timely manner may be insolvent.

Taking steps to protect your own business from the risks of non-payment is sensible. Some ways you can protect yourself and your business include:

• establishing payment terms that securing upfront deposits
• having the client supply key inputs and materials
• registering your interest in machinery or consigned stock that might be away from your premises through the Personal Property Security Register.

Checking the Payment Times Reports Register or credit bureaus for a prospective customer’s payment behaviour patterns or history (including substantial ATO debts) can help you make informed decisions.

The recent Business Risk Index by CreditorWatch highlighted delays in payment times as a key early warning sign a small business may be heading toward insolvency. Payment disputes have increased during my tenure as Ombudsman. Among the small and family businesses that later ceased operating, payment disputes feature in nearly half of cases.

If you’re a business that is struggling to pay what you owe, it’s important to reach out early and ask for time to pay or a payment plan, seek professional advice and if the challenges are severe, consider reaching out to the Small Business Debt Helpline for guidance. Be very wary of emergency short-term funding from non-Australian Financial Complaints Authority (AFCA) lenders as these loans can be punishing.

While the modest rise in the Pulse shows business confidence, the current operating environment is still challenging for small businesses. And it’s worth noting as 2026 is looking to be a high-compliance year with new reforms and expanding regulatory expectations.

Plan now for upcoming obligations

Anti-money laundering and counter-terrorism financing (AML/CTF) mandatory compliance requirements for the financial, gambling and bullion sectors will now extend to many unsuspecting small businesses. From 1 July 2026, these rules will also apply to small (and not-so-small) professional services firms providing accounting, legal and some business structuring and advisory services, along with real estate firms, and dealers in precious stones, metals and products.

Don’t wait until 1 July to see if the changes apply to you. Small operators captured by the new rules must enrol with AUSTRAC shortly after the end of March and have AML/CTF programs in place by 1 July. That means risk assessments, documented policies and controls, and a nominated responsible person to ensure compliance.

The AUSTRAC website has helpful resources to help small businesses know if they are affected, to be informed and to prepare. Industry associations and professional bodies can provide standard templates, risk assessments and guidance.

Also from 1 July, new obligations for Payday Super come into effect. Business owners may want to plan ahead by using payroll software that automates super, aligning payroll and super on the same day to reduce risk of missed deadlines, plan cash flow early, and build in internal buffers for bank and fund clearing times. Super contributions can no longer be held for quarterly payment and helping cash flow until due. For all employers, super will be a regular payroll duty, and it is a workplace obligation to make sure systems and payroll software is good to go.

ASBFEO continues to push for right-sized regulations for small businesses – for it to be proportionate, genuinely risk-based, readily implementable and supported by practical guidance to enable compliance. It is part of the small business-first approach that is needed to provide the best prospects for success and why it has been a constant theme during my term as Ombudsman, which now comes to an end.

Supporting small and family business

In my five years as Ombudsman, we have responded to more than 32,000 new requests for help with small and family business disputes and related challenges. During this time, almost 8000 requests for help were resolved by our case managers. Of these, 72 per cent provided active case management support, including information to help resolve the dispute, 23 per cent were referred to a more appropriate agency and 5 per cent were referred to alternative dispute resolution practitioner.

We also developed comprehensive franchising guidance and education resources, supporting the Ombudsman’s role as the designated mediation facilitator. More helpful resources are also available on the ASBFEO website.

We provide guidance to government on: improving small business disaster preparedness and resilience; enabling small businesses to access affordable risk protection; how government procurement can better support small firm participation; how ESG can be right-sized and beneficial for business durability; and how the Ombudsman can deliver better for more small and family businesses, government and regulators. We are well into a deep dive into business-to-business imposed “white” tape.

National advocacy on reforms for small and family business

Our advocacy has urged practical support and meaningful incentives to support small businesses deepening their digital engagement to be able to fully benefit from technological advancement, including AI.

We’ve strengthened the evidence base and visibility of small business conditions with the Small Business Pulse, which is being increasingly referenced for trends and insights into trading conditions, digital and AI take up, workforce challenges and other factors influencing small businesses.

I’m particularly proud of our 14 steps to energise enterprise, laying out practical, positive and doable steps that can create a more supportive environment for small business to form, compete and thrive. It continues to be a compelling and constructive blueprint on how to energise enterprise and is an example of forward-looking policy innovation that has seen the Ombudsman earn deserved recognition.

In 2025, the Australian Small Business and Family Enterprise Ombudsman was awarded the Ombudsmen and Commissions Alternative Dispute Resolution Group of the Year, ISO (International Organisation for Standardisation) certification and the International Council for Small Business 2025-26 Lighthouse Award, confirming that there is an excellent foundation and positive momentum from which the new Ombudsman can build to the advantage of Australia’s small and family businesses.

An honour to be your ally and advocate

I am pleased to welcome Lynda McAlary‑Smith as my successor. Lynda will commence as the Australian Small Business and Family Enterprise Ombudsman on 11 March 2026. Her leadership and experience as the Victorian Small Business Commissioner brings a strong and continuing focus on resolving disputes without recourse to the courts, advocating for practical improvements to the operating environment, and using data to generate meaningful insights.

Small and family businesses remain the beating heart of our communities and the engine room of the economy. As I move on from ASBFEO, I continue to be inspired by the perpetual optimism and relentless endeavour of enterprising business people who delight customers, create opportunities and strengthen local economies with your community spirit and leadership.

To all the enterprising women and men behind our small and family businesses giving it a go – it has been an honour and privilege to be your ally, advocate and champion.

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