ZipMoney set for growth with $200 million funding from NAB
Australian fintech zipMoney has secured a $200 million funding line, part of a $260 million facility from NAB, boosting its future profitability and share prices, reported the Australian Financial Review .
Like Afterpay, zipMoney is a point-of-sale platform that offers customers a take home layby experience, meaning they can buy items and take them home on the spot, but pay for them gradually over time.
The technology presents a welcome alternative to credit cards and has taken Australian shoppers by storm.
RELATED: Afterpay launches app aimed at millennial shoppers
ZipMoney has said the deal "will have a material positive impact" on its future profitability and puts the company in a good position to breakeven in 2018, as planned.
After the announcement of a two-year asset-backed securitisation warehouse for its consumer receivables, zipMoney shares jumped up by 10% to 68 cents. This securitisation should see its average funding cost reduced from 12% to 5%.
Larry Diamond, CEO of ZipMoney, said the new facility, "provides significant headroom for our rapidly growing origination volumes and an immediate bottom line benefit.”
ZipMoney is quickly growing in the “buy now, pay later” market. It had originated more than $200 million from 500,000 users shopping at over 3000 retailers in April this year and last year expanded by buying the free budgeting app Pocketbook, which has 350,000 users and is popular among the millennial demographic.
According to Australian Financial Review, the NAB funding represents the largest debt market deal to date for an Australian fintech company.
This is an impressive achievement when considering that Australia has been found to have the fourth largest fintech credit market in the world, with 29 different platforms in operation.
Steve Lambert, NAB's executive general manager of capital financing said the funding facility agreement was in line with NAB's commitment to fintech innovation in Australia.
Mozo provides general product information. We don't consider your personal objectives, financial situation or needs and we aren't recommending any specific product to you. You should make your own decision after reading the PDS or offer documentation, or seeking independent advice.
While we pride ourselves on covering a wide range of products, we don't cover every product in the market. If you decide to apply for a product through our website, you will be dealing directly with the provider of that product and not with Mozo.