Mutual lender takes equity stake in fintech platform

by Phil McCarroll27 Sep 2016
Beyond Bank Australia has become the fourth customer-owned lender to take an equity stake in growing marketplace lender SocietyOne.

The mutual lender yesterday announced it has acquired $1.5 million worth of shares in SocietyOne, as well as agreeing to increase its funding arrangement with the marketplace lender to $10m.

G&C Mutual Bank, Maritime, Mining and Power Credit Union and Regional Australia Bank joined SocietyOne’s share register in May this year following the company’s successful $25m capital raising.

The move by Beyond Bank Australia to take a stake in SocietyOne follows a long relationship between the two, with Beyond Bank Australia among the first institutions to become a direct SocietyOne investor funder when it provided a $1.5 million facility in October 2014 to fund borrower loans.

“We’ve been talking to SocietyOne about this for a little while. Being a private company we just had to wait until the right opportunity arose,” Beyond Bank Australia deputy chief executive officer Wayne Matters told Australian Broker.

“We started lending to SocietyOne about two years ago and we’re very excited about taking this next to deepen the relationship between us,” Matters told Australian Broker.

Matters said the mutual lender’s initial involvement with SocietyOne was a move aimed at positioning Beyond Bank Australia closer to the fintech space. Further conversations between the two organisations convinced Beyond Bank Australia that SocietyOne would likely be a platform that continues to have success after the initial fintech boom subsides.

“We’ve been in the personal lending game for 60 years and SocietyOne was a new model for personal lending and we wanted to get closer to that,” Matters told Australian Broker.

“When we started speaking to them we were very excited to find that their value set was very much aligned with ours, we’re a mutual bank and [SocietyOne] are very much aligned with making sure borrowers and depositor are bought together through their marketplace and that’s very close to the mutual ethos.

“They were probably one of the first to get going in the space and they’re reasonably well established now and are writing terrific loan volumes, so I think they’re well placed in the fintech and P2P lending space to be one that has an ongoing life and prosperity.”

SocietyOne chief executive officer and managing director Jason Yetton said Beyond Bank Australia’s investment caps a successful period for the marketplace lender and is an important step for its future growth goals.

“Beyond Bank’s support and that of our other investor funders is one of the key reasons we have been growing so strongly. We have now passed through $100 million of personal loan originations since we started and taken our total originations including our support for Australian agribusiness to more than $150 million. That is an increase of $50 million alone since early April this year,” Yetton said.

“We have done this thanks to the support of our investor funders’ and look forward to Beyond Bank’s increased funding commitment as we undergo a further period of expansion and target a 2-3% share of the $100 billion consumer finance market by 2021,” he said.
 

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