- Prospa’s loans for 2018 were $367 million, up 70%, and 9% better than prospectus forecasts.
- The fintech has now delivered over $750 million in loans to 15,000 Australian small businesses.
- Loans in New Zealand reaches $NZ1million in the first 30 days.
Fintech Prospa, a lender to small business which in June postponed an ASX-listing after being pinged about unfair loans terms, says it has now written $750 million in loans.
Loans for the year to June were $367 million, a 70% increase on the previous 12 months and 9% higher than prospectus forecasts with strong momentum in the fourth quarter.
For the six months to June 2018, loans hit $211 million, up 16% on prospectus forecasts and up 61% on the previous corresponding period.
Earlier this month Prospa confirmed it had removed or amended some of its contract terms seen as unfair following a review by corporate regulator ASIC.
Among the terms amended is an early repayment clause so that borrowers can now prepay a loan early without requiring Prospa’s consent.
Prospa estimates there is an addressable market for small business lending in Australia of more than $20 billion a year.
Looking ahead, Prospa is focused on continued growth via its core loan product in Australia and New Zealand and the launch of a line of credit product.
The business has originated more than $NZ1 million in loans in its first month of operation in New Zealand.
Greg Moshal, co-founder and joint CEO, says growth is driven by small businesses’ need for quick and easy access to finance to manage cash flow and seize opportunities to grow.
“The increasing demand for our product shows we deliver a much-needed service that is highly valued by our customers, both existing and new,” he says.
“When Beau (Bertoli) and I started this business six years ago there was nowhere a small business could turn to if they had a great idea, and needed funds to make it happen. The system was failing them, and we thought there had to be a better way.
“From that moment we have always put the customer at the heart of everything we do. We designed an application process that was simple, taking the hassle out of finance. We engineered our processes to deliver fast, accurate decisions, so our small business customers could get certainty and move on with doing business.”
Prospa’s interest rates range from 8.5% and 29.9%.
Beau Bertoli, co-founder and joint CEO, says the objective is always to bring the cost of borrowing down.
“There are a number of factors that determine our rates — including the cost of capital, which, if you’re a non-bank lender is much higher than the banks,” he says.
“Another factor is risk, and our rates are risk adjusted to the borrower. Pricing appropriately for risk allows us to have a sustainable business so we can achieve our objective of supporting as many small businesses as we can.”
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