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Prospa surpasses $1bn in loan originations

Prospa surpasses $1bn in loan originations

The SME lender has announced that it has provided more than $1 billion in loans to over 19,000 SMEs in Australia and New Zealand. 

Prospa has announced surpassing $1 billion in loan originations since its inception in 2011.

The fintech lender’s loan originations for the 2018 calendar year amounted to $436 million, up 51 per cent on the prior corresponding period.

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Loan originations for the first half of the 2019 financial year reached $225 million, an increase of 44 per cent on the previous corresponding period.

Revenue for the half-year period was reported to be $67.7 million, a 41 per cent rise on the prior corresponding period.

Meanwhile, pro forma EBITDA for the H1 FY19 reached $6.1 million, up 41 per cent on the prior corresponding period, as the company reportedly seeks “lower funding costs” and increases investment in core and new products.

Prospa CFO Ed Bigazzi said: “It’s been a healthy start to the 2019 financial year for originations, revenue and EBITDA, and we’ve laid strong foundations for our growth plans. Our loss performance remains within the board-mandated range and our 90+ days past due remains stable.”

In addition, Prospa recently announced that it has hired Resimac’s former general manager of mortgages New Zealand, Adrienne Church, as its first general manager to head up operations in New Zealand.

Beau Bertoli, co-founder and joint CEO of Prospa, said: “We have successfully completed a pilot program in the New Zealand market, delivering loan originations of approximately NZ$10 million in the first six months, and we’re looking forward to continuing this trajectory as we scale up our operations.”

Mr Bertoli noted the contribution of th elender’s third-party network.  

 “This is a massive milestone for both Prospa and our broker partners who helped us get here,” he said. “We’ve now provided more than one billion dollars in funding to over 19,000 small businesses.”

He concluded: “This finance keeps cafes, retailers, tradies and manufacturers moving and seizing new opportunities. We’re excited to work with our partners to deliver new cash flow products and services to even more small business owners across Australia and New Zealand.”

Lower funding costs

In the past three months, Prospa announced it has “optimised its funding structures” by refinancing $45 million in junior notes to new fixed-income investors, which has reduced the fintech lender’s “fully drawn cost of funds”.

Prospa will reportedly “continue to pass savings onto its customers”, with the weighted annual percentage rate of its portfolio reaching 36 per cent.

The SME lender also suggested that its “lower funding costs” have allowed the company to access “greater segments” of the SME lending market.

According to Prospa, its interest rates range between “8.5 per cent and 29.9 per cent” based on the credit quality of its SME customers.

Prospa further announced that in October 2018, it raised additional growth capital through a “$43 million convertible notes issue”, which will fund growth of its “core product” while aiding the company’s growing presence in New Zealand’s marketplace.

Mr Bertoli added: “In October, Prospa raised $43 million in funding, enabling further investment in developing our cash flow products and services, and funding increasing momentum in our loan book. We’re delighted by the support we received from both new and long-term investors.”

“Prospa continues to assess the funding requirements for the business as we grow and execute our strategy.”

Board changes and senior appointments

Prospa also announced that, effective February 2019, non-executive director Gail Pemberton will assume the position of chair and replace Greg Ruddock, who will “continue in his capacity” as a non-executive director.

Ms Pemberton said: “Prospa is a business with great energy and vision, and a determination to advance the cause of its customers. I believe it has an important role to play in funding the future growth of Australian small businesses, and I am delighted to have the opportunity to serve as chairman.”

Prospa has also appointed Emma Robinson as its chief marketing officer and Elise Ward as the general manager of people and culture.

Ms Robinson was previously head of marketing for ANZ’s business and private banking. Prospa reported that her focus will be on “digital acquisition, brand building, customer engagement and retention, and designing new product innovations”.

Meanwhile, Ms Ward previously held senior roles at Samsung, Tabcorp and ElasticPath Software. The SME lender reported that her focus will be on attracting new talent and developing employee experience. 

Prospa surpasses $1bn in loan originations
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Ezekiel MacNevin

Ezekiel is a journalist on the mortgages, property investment and wellness titles at Momentum Media. 

Before joining the team in 2019, he was a freelance journalist for Vice Australia, Pulse Radio and the Sydney-based travel publication Global Hobo, among others. 

Ezekiel studies a double Bachelor of Communications and International Studies at the University of Technology, Sydney.

You can email Ezekiel on: This email address is being protected from spambots. You need JavaScript enabled to view it.

 

 

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