A well-known Australian family fund, which wishes to remain anonymous, has made a substantial investment in a Fintech Start-up.
MoneyMe, a short-term lender, lends up to $2,000 at monthly interest rates of between 15 and 24 per cent. Once it lends more than $2,000, caps on effective interest rates reduce to 48 per cent.
As well as helping the startup increase the value of its loans from $2000, MoneyMe CEO Clayton Howes said the funding will go towards the launch of a series of niche financial products that the startup will be marketing to millennials throughout 2016, with this market a core focus.
Millennial Market
«The millennial market is a particularly important one for financial organisations, as it is a market with a demonstrated propensity to spend big on lifestyle and convenience, and pay a premium for the opportunity to do so. For this reason, fintechs with the ability to create niche products that are delivered in a tailored way that suits the unique needs of the millennial market will immediately find themselves at an advantage over slower-moving, more traditional finance providers,» Howes said.
The family fund is said to be looking for alternatives to real estate investment as with the slowdown of the Greater China region, growth in the Australian property sector looks unsure.
It is understood that both Bendigo and Adelaide Bank had been contemplating providing loans to MoneyMe, but the deal with the family office was a more attractive option.
