Brisbane fintech Jacaranda Finance announces move into the prime lending space
Brisbane-based lender Jacaranda Finance today announced plans to enter the prime personal loan market, after six years of offering small loans in the sub and near prime space.
Jacaranda Finance CEO and Founder, Daniel Wessels, said the move has come about naturally as the company ‘grows up’.
The limitations of traditional banking models have created a gap in the market, allowing challenger lenders to capitalise. Moving into the prime lending space will allow the company to offer personal loan solutions to a full spectrum of borrowers and increase relevance in the fast-evolving personal loan space.
“This is the natural evolution of Jacaranda as a lender,” said Wessels. “We have been operating in the subprime and near prime space for a number of years and over time we’ve seen an increase in clean credit borrowers as traditional lenders rely heavily on credit scores and as digitally savvy consumers flock away from the inflexible nature of traditional lending and banking services.”
“When I started Jacaranda Finance, we had a simple mission of creating seamless financial inclusion. We wanted to offer lending services to the ‘unbankable’. The consumers that traditional finance had turned their back on. Fuelled by open banking, AI and machine learning we’ve built a platform that gives consumers the digital experience they demand.”
The fintech or ‘financial technology’ sector has seen rapid growth in Australia in recent years, with research finding more than half of all digitally-active Australians (58%) are now using fintech products and services. From 2010 to 2018, Australian banks’ share of personal loans also fell from 86% to 72%, as online lenders steadily won market share.
Many attribute this to a recent shift in Australian’s attitudes, with banks slow to react to advancements in the sector and growing public skepticism.
Recent research on Australian millennials found more than one in three don’t trust banks, with 37% less likely to own a credit card than older generations. As younger consumers increasingly turn away from traditional providers and forms of credit, it’s clear the prospectus for Fintechs has never been better.
“I’ve said it before, but it’s evolve or die when it comes to technology and the line between finance and tech is only going to continue to blur with time.” said Wessels, “Financial services are about being nifty, agile and responsive to the ever-changing needs of customers.”
“In the short term we’re going to stick to our game plan of using the wealth of consumer data that we collect to be innovative, launch new products and establish new partnerships. Yet, we’ll also continue to find ways of engaging with customers to their benefit – so far, they are loving it!”
