The head of Australian FinTech, MoneyMe believes the credit lending market is undergoing drastic changes in the rapidly shifting post COVID-19 economy.
MoneyMe, which leverages artificial intelligence and big data analytics on its Horizon platform, has posted its inaugural annual result as a listed company.
The Australian company announced revenue of $47.7 million, up 49.5 per cent on the prior year and ahead of forecast by four per cent.
While earnings were $3.2 million, 10.5 per cent ahead of forecast.
MoneyMe’s Chief Executive Officer, Clayton Howes says COVID-19 has seen a seismic shift in the market landscape.
“It’s just catapulted the speed of execution into the digital world for everyone,” he says.
“AI allows for decisioning for agile changes in our macro and micro environment, you need to calibrate data really quickly.”
Figures in 2019 showed the global fintech market was valued at around $US127 billion in 2018, and was expected to grow to $US309 billion at an annual growth rate of 24.8 per cent through 2022.
COVID-19 has almost certainly changed those market predictions, one way or another.
From MoneyMe’s perspective, Howes says COVID-19 has seen a significant uptake from Australians using the company’s financial technology.
“All of a sudden, bang, everyone is now the same as the ‘generation now’ customer, where they are tech enabled and online ready consumers,” he says.
“Automation gives us the opportunity to be agile, manoeuvre with customers with changing patterns, emerging into new opportunities, where banks won’t be able to keep up.”
“It provides the ability to make clever, smart decisions on credit that traditional data points would not be able to help with, in fast paced changing environments,” Howes says.
“We can change our credit algorithmic decisions for any particular spike in ten minutes,” he says.
“We’ve heard of banks and other traditonals taking six months to change the most binary form of credit decisioning.”
Howes believes while making access to credit more efficient is positive, the industry must continue to ensure strict due diligence processes are in place.
He says digital credit lending actually provides the opportunity for increased levels of security and due diligence.
“I do believe that the fundamentals around having credit quality – considered credit provision to the right customers – that should not change,” he says.
“We have to make contemporary credit decisions for the contemporary customer in the digital world, where their footprints are so transparent.
“In a cash society, we wouldn’t know where they’d be spending their money, whereas 99.9 of their digital transactions have a digital footprint.
“So there’s no reason why we can’t be providing both. The fast convenient solution to credit, but also allowing for the traditional way of looking at customers as a form of good quality credit that allows them to advance in their credit life cycle.”
In its earnings report, MoneyMe says it plans to continue its growth strategy, seeking to gain market share through existing products, as well as entering new consumer lending markets through product innovation and developing new partnerships.