Title Aussie FinTech Lender of the Year Continues to Grow After Loan Origins Surpass $ 1 Billion –

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Beau Bertoli & Greg Moshal

Prospa, one of Australia’s leading online small business lenders, is pleased to report its pro forma results for H1 FY19. Total loan origination for the first half of fiscal 2019 was $ 225 million, up 10% from forecast of $ 204 million and 44% on a PCP basis.

Total loan origination for the 2018 calendar year was $ 436 million, up 13% from the forecast of $ 386 million and 51% on a PCP basis.

Customer satisfaction has also remained consistently high, with an average Prospa Net Promoter Score above +77 in 2018. Prospa also has a score of 9.8 / 10 on the independent review platform TrustPilot.

What does this growth look like in Prospa’s Australian and New Zealand markets?

Prospa’s total loan origination has now exceeded $ 1 billion, including A $ 1 billion in Australia and NZ $ 10 million in New Zealand, issued to more than 19,000 small businesses as demand continues. to grow.

Revenue is ahead of forecast with H1 FY19 revenue of $ 67.7 million, up 8% from forecast and 41% from pcp. This performance was driven by solid loan issuance.

Pro forma EBITDA for the first half of fiscal 19 was $ 6.1 million, up 17% from forecast and 41% from pcp, as the company continues to actively seek lower financing costs and invest more in major and new product opportunities.

Ed Bigazzi, CFO, said: “This is a good start to 2019 for builds, revenue and EBITDA and we have laid a solid foundation for our growth plans.

“Our loss performance remains within the range prescribed by the Board and our 90+ days overdue (DPD) remains stable. “

Greg Moshal, co-founder and co-CEO of Prospa, said: “The growing demand for our products shows that we are providing a much needed service that is highly valued by our customers.

“Small businesses are the engine room of our economy. We’re incredibly proud of the work our team does every day to move small businesses forward with the right financial solution for their needs.

Beau Bertoli, co-founder and co-CEO of Prospa, said: “We have successfully completed a pilot program in the New Zealand market, issuing loan origins of approximately NZ $ 10 million over the years. First 6 months and look forward to continuing this trajectory as we scale up our operations.

How does the fintech lender reduce their financing costs?

Over the past three months, Prospa has further optimized its funding structures and refinanced A $ 45 million of junior bonds to new bond investors, significantly lowering the cost of its fully drawn funds.

In line with its long-term strategy, Prospa will continue to pass savings on to its customers, with the portfolio’s weighted annual percentage rate (APR) now standing at 36%.

Our lower financing costs allow Prospa to access larger segments of the small business loan market. Prospa’s interest rates vary between 8.5% and 29.9% depending on the credit quality.

In October 2018, Prospa raised additional growth capital through a $ 43 million convertible bond issue that was well supported by existing and new investors, including AustralianSuper.

This capital will finance the growth of the commodity, in addition to further expansion into the New Zealand market and the development of new products and services.

“In October, Prospa raised $ 43 million in financing, allowing further investment in the development of our cash flow products and services; and the financing of a growing dynamic in our loan portfolio, ”Bertoli suggested. “We are delighted with the support we have received from new and long-term investors. “

He added, “Prospa continues to assess the financing needs of the business as we develop and implement our strategy. “

Greg Moshal & Beau Bertoli, co-founders Prospa

What does Prospa plan for small businesses?

Small businesses are a major contributor to the economy, with 2.3 million small businesses in Australia employing 44 percent of Australia’s private sector workforce and generating 35 percent of Australia’s GDP.

These small businesses have been underserved by the traditional banking system and are increasingly turning to unsecured online loans to support their growth.

Prospa sees a substantial market opportunity and estimates that the potential market opportunity for small business loans in Australia is over $ 20 billion per year.

In January 2019, Prospa, in partnership with RFi Group and the Center for International Economics, published a study on the economic impact of its loans to small businesses in Australia.

The analysis found that Prospa’s loans contributed $ 3.65 billion to Australia’s GDP and helped maintain more than 52,500 full-time equivalent jobs annually over the previous five years.

In addition, more than one in four businesses surveyed did not know whether it would still operate without Prospa’s loans or thought it would no longer exist.

In 2018 alone, analysis found that Prospa’s loans added nearly $ 1.7 billion to Australia’s GDP and helped sustain over 24,000 FTE positions.

“We have always believed that our loans have a positive economic impact and add real value to small business owners. Independent analysis by RFi Group and The CIE clearly demonstrates how access to capital enables small businesses to grow and create jobs, ”said Moshal.

“The results are better than we imagined and give us an immense sense of pride in the impact of Prospa on the jobs and wealth of households, local communities and the Australian economy. “

How does Prospa engage with its customers?

Prospa is a founding signatory of the AFIA Code of Lending Practices (“Code”) for Small Business Online Lenders and has been operating under the Code since January 1, 2019.

Prospa was instrumental in shaping the new Code and reaffirms its commitment to increased transparency so that small business owners can clearly assess whether a loan is suitable for their needs, how much it will cost and whether it will cost or not. this is the best solution available to them.

Bertoli said: “The feedback from our team and our customers has been positive and the increased information we provide resonates with all stakeholders. We anticipate continued positive momentum.

Beau Bertoli, co-CEO of Prospa

Prospa has a history of leadership and innovation in the industry, having funded its first loan in 2012, implemented same-day loan approval capability in 2013 and implemented Australia’s first small loan securitization. companies in 2015.

As traditional banks have moved away from lending to small businesses, Prospa has made significant investments in customer experience and customer success teams that seek to provide personalized support to small business owners.

What changes are taking place in the Prospa meeting room?

In February 2019, Gail Pemberton AO, who was a non-executive director of Prospa, took on the role of president in a succession planned 12 months ago when she first joined the board.

Greg Ruddock has stepped down as chairman, but continues to serve as a non-executive director.

Ms. Pemberton said: “Prospa is a company with great energy and vision and determined to advance the cause of its customers. I believe she has an important role to play in funding the future growth of Australian small businesses and I am delighted to have the opportunity to take on the chairmanship. “

Prospa also appointed Emma Robinson as Marketing Director and Elise Ward as Managing Director, People & Culture. Prior to joining Prospa, Emma was Marketing Manager for ANZ Business & Private Banking.

She will particularly focus on digital acquisition, brand building, customer engagement and retention, and the design of new product innovations.

On the other hand, Elise’s position is focused on attracting world-class talent and developing an exceptional employee experience. Elise previously held leadership roles at Samsung, Tabcorp and ElasticPath Software.

What future for this fintech lender?

Prospa provides treasury products and services that enable small businesses to thrive. The co-founder and co-CEO Bertoli sees the company maintaining its growth for a good part of the year.

“We also plan to launch our line of credit in Australia in the second half of the year as a convenient and flexible source of funds that puts small business owners in charge of their finances,” he said.

“We will also continue to build a better business loan that provides fixed term financing for small businesses. “

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