Major banks exiting personal lending space provides “great opportunity”, says investor
New Zealand small personal lender Nectar has entered into a partnership with Silverhorn Group, a Hong Kong institutional investor, which will provide up to half of Nectar’s monthly lending needs on an ongoing basis.
Silverhorn Group provided US$1 million to Nectar in the first month of the funding facility being in place, though Nectar says the amounts will vary from month to month.
Nectar has been growing at 200% annually, and the investment is Silverhorn Group’s first venture into New Zealand. Nectar says the open-ended agreement will play a key role in supporting its ongoing growth, which will include the launch of a new finance product – NectarPay – for retailers and tradespeople.
Nectar offers personal loans of up to NZ$20,000, and has originated NZ$20 million in personal loans to 59,000 New Zealanders since its launch.
“We are excited to have Nectar as our first lending partner in New Zealand,” Silverhorn Group CEO Mike Imam said.
“Nectar’s dynamic credit scoring model, coupled with New Zealand’s growing credit needs in light of traditional banks exiting this space, provides a great opportunity for us to gain exposure to high quality borrowers in a growing alternative lending market.
“We continue to look for partners that can grow with our fund, as we aim to achieve high double-digit percentage growth in the fund’s assets over the next year.”
Commenting on the funding facility, Nectar CEO Symon Nausbaum said: “Securing ongoing funding on competitive terms is vital to meeting the demand from consumers for innovative loan products, especially as traditional lending options tighten, and we are delighted to be working with Silverhorn Group.
“Increasing the funds we have available to lend means we can now also expand our lending platform to enable retailers and tradespeople to offer their customers instalment-based payment plans for up to NZ$20,000 with NectarPay.”
