Prospa launches $45m facility to fund small business loans
Prospa has launched a new warehouse facility that will be able to fund loans for New Zealand’s small businesses.
The facility, which has an initial capacity of $45 million and a three-year commitment, was built to help support small businesses row.
“Our first New Zealand warehouse creates a solid platform for growth as we continue to pioneer in the online small business lending space. We believe over time it will act as a conduit to bring global funds into New Zealand and increase access to finance for small businesses across the country,” says Prospa’s chief financial officer Ed Bigazzi.
Prospa currently manages more than 19,000 small business customers. The company has also originated more than $1 billion in loans across Australia and New Zealand.
As a standalone funding platform, the facility is an important part of Prospa’s long term capital management strategy.
Prospa believes the facility will allow the company to redeploy approximately $6 million of equity capital into its fast growing Australian business, while allowing for additional funders to be added as operations in New Zealand expand.
The facility is designed to be seamlessly scalable with a similar structure to Prospa’s Australian funding platform. The funding costs are broadly consistent with the levels observed for Prospa’s facilities in the Australian market.
To make it happen, Prospa has partnered with a top-tier local funding partner who has a strong understanding of the small business lending space and a long-term interest in supporting small businesses in the region.
The unnamed funding partner has subscribed to Class B Notes in the NZ facility and lays a foundation for attracting high quality Class A investors.
“This facility will allow us to support an increasing number of local small businesses,” comments Prospa New Zealand general manager Adrienne Church.
“Our New Zealand customer base is diversified across a range of industry sectors including hospitality, retail, professional services and building and trade.
“We have a TrustPilot rating in New Zealand of 9.8 out of 10 as at 31 July 2019 and we rank first in the non-bank finance category. We’re incredibly proud of the work we do to support small businesses in New Zealand and enjoy watching those businesses invest, employ and grow,” concludes Church.
In 2018 and 2019 Prospa won Australian Fintech Lender of the Year, achieving a clean sweep of the MFAA Excellence awards in all five States. The company was also designated an AON Hewitt Employer of Choice in 2017 and 2018.