Home SMART 100 2016 MoneyMe risk-based small amount consumer loan pricing

MoneyMe risk-based small amount consumer loan pricing [SMART 100, 2016]

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This SMART 100 profile and the information it contains is a duplication of content submitted by the applicant during the entry process. As a function of entry, applicants were required to declare that all details are factually correct, do not infringe on another’s intellectual property and are not unlawful, threatening, defamatory, invasive of privacy, obscene, or otherwise objectionable. Some profiles have been edited for reasons of space and clarity.

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1. THE BEGINNING

This innovation initially came to life when…

two former telco executives decided they wanted to break free from corporate Australia and use their decades of experience to revolutionise the way finance was administered to the millennial market. They set about developing a tech-based credit assessment algorithm that determined the individual risk profile of applicants using more social and online touch points than the big banks were able to, and unveiled this “risk-based small amount consumer loan pricing” mid-2015. The idea was backed by some enthusiastic shareholders, including commercial property entrepreneur, Scott Emery, allowing us to grow the business to where we are today.

The purpose of this innovation is to…

provide the Australian millennial market with a short-term, small-amount source of finance at a price that is personalised to their individual risk profile, and without having to resort to ongoing credit facilities, such as credit cards.

It does this by…

assessing each applicant’s risk profile individually using sophisticated credit decisioning technology which takes into account their positive repayment behaviour – much like comprehensive credit reporting would do if introduced into the Australian market such as a number of fintechs are currently pushing the Australian government for. We are seeking to create this within our own model.

3. PURPOSE & BENEFITS

This innovation improves on what came before because…

the Australian market for small loans was previously filled with lenders dependent on revenue streams derived from frequent fees and charges, and very high interest rates applied across the board. We also offer 24/7 access to credit, so no waiting for banks to open and on business days only.

Its various benefits to the customer/end-user include…

a cheaper, short-term loan that allows the end-user to meet a small need for cash but be debt free again within 30 to 60 days, depending on the loan product selected, and their choice of repayment schedule.

4. COMPETITIVE LANDSCAPE

In the past, this problem was solved by…

it wasn’t. Consumers in this segment of the market were forced to pay exorbitant interest rates, regardless of their risk profile, while suffering hidden fees and charges, or take on ongoing debt facilities such as credit cards whose business models are based on users making minimum repayments and never actually getting back out of debt.

Its predecessors/competitors include…

Banks that are open 9am-4pm, Mon-Fri only (and don’t service the market properly anyway) and predatory payday lenders who charge the same high interest rates to every single customer, often those who shouldn’t be given the loan at all.

5. TARGET MARKET

It is made for…

millennials- a market looking for maximum convenience/minimum commitment, with a spend-as-you-earn approach, and wants to experience a certain lifestyle and buy the latest gadgets, without the long term commitment of managing credit card debt, or having to go through the process of entering a bricks and mortar bank to fill out lengthy paperwork to apply for credit. It’s a group that wants to access cash via their mobiles when and how they want it. Our robot decisioning allows for instant decisions, where our algorithms do all the hard work making the customer journey a breeze with immediate money transfers.

It is available for sale through…

any device that a millennial might wish to use – their mobile, i-pad, tablet, laptop, or even desktop computer. All that’s needed is an internet connection and the user is ready to apply for a MoneyMe loan.

Our marketing strategy is to…

meet the consumer when and where they engage socially, and speaking to them in their language. 80% of our customers apply for loans on their mobile! We also recently ran a campaign that had our logo and hashtags featured on dozens of our customers’ cars in return for free fuel because our campaigns always involve direct social engagement.

FINE PRINT: This SMART 100 profile and the information it contains is a duplication of content submitted by the applicant during the entry process. As a function of entry, applicants were required to declare that all details are factually correct, do not infringe on another’s intellectual property and are not unlawful, threatening, defamatory, invasive of privacy, obscene, or otherwise objectionable. Some profiles have been edited for reasons of space and clarity.

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