Propell Holdings opens bid to raise $2.22 million for small business loan app
Australian fintech company Propell Holdings (ASX:PHL) has announced a $2.22 million rights offering to shareholders with ambitions to fund continued organic growth and an increase in its lending facility.
The company has invited shareholders to participate in the non-revocable pro rata offer of one new share for 2.5 shares held on April 27, 2022, at an issue price of $0.058 per new share.
Propell is Australia’s first and only ‘all-in-one’ platform focused on small and medium-sized enterprises (SMEs) in Australia that offers lending, information and payment solutions through a single product. It leveraged its vast customer data with an artificial intelligence (AI)-based engine to deliver its products in an all-digital format.
The company launched its app in mid-2020 and aims to improve the cash flow and financial well-being of Australian small businesses by bringing together a range of financial products and services, including loans, payments and flow forecasting tools. cash.
Offer of right
Propell’s rights offering opened in late April and will close on May 19, 2022. The adviser managing the rights offering is Reach Markets.
While the offering is for 1:2.5 shares at $0.058 per share, Propell will allow existing shareholders to participate at the same issue price as the previous initial offering which raised $1.36 million.
The company said the funds raised will be used to support an increase in its lending facility, as well as continued organic growth through working capital and to cover offering costs.
Recent financial performance
In its latest financial update, Propell announced a record quarter for loans, achieving a 211% increase from the December 2021 quarter to the March 2022 quarter. This growth was supported by the launch of a new line of credit product and improved financial data and platform customer confidence.
The platform’s customers also grew by 35% to more than 1,700 at the end of March.
Additionally, loan volumes were driven by a 138% increase in average loan size, which the company said was a key indicator of customer quality – a key metric to scale the business. .
Propell ended the quarter with $140,000 in cash.
Launch of a new credit facility
Propell’s new line of credit can offer unsecured loans from $5,000 to $250,000 for terms of up to 12 months, resulting in an increase in total facilities approved from $3.9 million to over $9 million and an increase in average loan size of 138% in the quarter. on a quarter.
The company says its digital platform enables a “simple and fast” customer journey, from registration to approval “in minutes” and withdrawal and checkout “in hours”.
The launch follows successful product trials in December and January.
Propell believes the product represents an important new revenue line that should contribute significantly to future revenue growth given its features, higher average loan size and target segment demand.
“This is an important milestone for the company as it builds on Propell’s core proposition, further allowing small businesses quick and easy access to the financial products they need to operate and grow. “, did he declare.
The company also continued development of its underlying platform throughout the March quarter, providing continuous platform automation updates focusing on the four key management areas. customers, service, loan management and collections.