Small-business finance options expand with new Prospa offering

Small-business financer Prospa is expanding its offering to become the country’s first non-bank all-in-one Business Account for small businesses.

Chief executive and co-founder Greg Moshal said the past three years have seen small businesses have to cope with many challenges that have seen them having to find alternate solutions for their current and future needs.

“Over the past 10 years, Prospa has put our knowledge and understanding of small business to work. We’ve continued to invest in research, and listened to our customers, which has prepared us for the next 10 years of growth,” he said.

“We know small business owners are time-poor and using an average of six to eight apps for day-to-day financial management, and that access to working capital is still the biggest issue they face. It’s why we’ve introduced the Prospa Business Account.”

The Business Account will allow small businesses to manage cash flow in one place via a free, easy-to-use account with no minimum balance or deposits needed. 

Businesses can apply in minutes and start using their account straight away including debit card payments via Apple Pay or Google Pay.

It will also offer near-instant payment methods at home or overseas, pay bills via BPAY, or schedule payments in advance.

“From day one, we have aimed to give our customers an experience that is not just a little bit better, but 10 times better,” Mr Moshal said.

“It’s why we invest in deeply understanding our customers and what pain points small businesses have and what the traditional banks aren’t solving.”

In its Q1 2023 results so far Prospa had originations reaching $205.5 million, up 60 per cent on pcp (Q1 FY22: $128.4 million). The group achieved $3 billion of lifetime originations during the quarter, further demonstrating the ability to capture greater market share of the small-business lending market. Prospa’s previous record first quarter for originations was $130.0 million, which was achieved in Q1 FY20.

Its New Zealand business continued to grow, with originations contributing $48.3 million for the quarter. The Line of Credit funding product continues to gain traction following its full national launch in July 2022.

The company achieved 11 per cent growth in active customers to 17,900 compared to the previous quarter while maintaining a net promoter score (NPS) of more than 80. As a result of strong demand for funds, closing gross loans reached $768.3 million for the quarter, an increase of 74 per cent on pcp (Q1 FY22: $442.2 million).

Total revenue increased by 69 per cent over pcp to $63.7 million (Q1 FY22: $37.8 million), supported by a stable portfolio yield of 34.4 per cent (Q1 FY22: 34.3 per cent).