A new online lending platform set to reshape the Australian credit market has registered a mass of brokers after promising to reward them for leads.
ThinCats has seen 134 lenders and finance brokers register since its launch in December last year.
The online lender has completed its first two loans and a pipeline is now in place for 2015.
ThinCats enables 'sophisticated' and wholesale investors to lend directly to the country’s 2.1 million small to medium-sized businesses, providing them with a viable alternative to traditional bank lending.
Its first two loans are worth $113,500. The first, at an annual rate of interest of 11.5 per cent, is to Shankar Trades World Pty Ltd, an importer of granite, marble, limestone and sandstone slabs from China, India and Italy.
The second loan completed on the platform is to Voltaic Energy Pty Ltd, which procures and installs (using contractors) complete solar systems, predominantly to commercial enterprises.
The ThinCats platform is a joint venture with ThinCats UK, which has completed more than $160 million worth of secured business loans over the past four years and is one of the two leading peer-to-peer business lenders in the UK.
“We are delighted with the response from lenders, borrowers and brokers to our unique platform, targeting specifically the millions of small to medium [sized] businesses whose financial needs are often ignored by the big lenders,” ThinCats Australia chief executive Sunil Aranha said.
“We have already found a good niche with the SMEs, which borrow about $73 billion a year to finance their operations, and expect to build our portfolio of loans quickly as sophisticated and wholesale investors discover the potency of our platform.
“We are also generating a lot of interest from finance brokers, who we will be rewarding as they bring loans to the platform,” he said.
Mr Aranha has more than 25 years' international and local SME banking experience with Citibank, Commonwealth Bank of Australia and the Export Finance Investment Corporation in Australia, and is supported by a strong executive management team with extensive banking and financial services experience.
“There are about 400,000 high net worth investors and their super funds holding around $1 trillion in investable assets looking for better returns, which can be found in the businesses we lend to through the ThinCats’ platform,” he said.
Lenders spread their risk by lending to multiple businesses at a price determined by the market, providing them with access to a fixed interest asset class which has largely been the domain of the banks.
The global market for peer-to-peer lending is currently worth over $6 billion and doubling in value every year as the concept gains broader understanding and acceptance.