The $200m additional debt facility from Morgan Stanley will support MoneyMe’s automotive lending business, a segment rapidly growing as major players exit the market.

Following the $1bn originations milestone in Q1 and record growth in Q2, fintech lender MoneyMe (ASX:MME) has now secured an additional funding facility for the next phase of growth.

The company announced a new warehouse funding facility led by Morgan Stanley Australia has been established to meet the needs of its rapidly growing Autopay product.

An immediate $200m in additional capacity has been approved to finance the Autopay receivables, allowing MoneyMe to make further traction in the hot automotive lending market.

After securing the funds at less than 3% above the benchmark 1-month BBSW rate, the new facility is expected to immediately slash the overall group’s funding costs.

The variable rate funding also fully aligns to the Autopay’s variable rate consumer pricing, negating any market risk that could otherwise arise in a rising rates scenario.

Morgan Stanley is the senior funder of the facility, with Revolution Asset Management being the Mezzanine funder.

Separately, MoneyMe also announced a further 10% increase to its Horizon 2020 Trust (HW20) Major Bank funding capacity to $467 million.

MoneyMe CEO Clayton Howes said the new warehouse facility is significant for Autopay’s growth in 2022, as it expects market demand for the platform to increase further with major long-term players exiting the market.

“We’re delighted with the growth and further strengthening of MoneyMe’s funding platform, as we welcome Morgan Stanley as an international bank funding partner,” said Howes.

“It’s also fantastic to have this further funding capacity added for the group alongside a further increase to the Major Bank HW20 facility. “

 

MoneyMe’s record quarter

Earlier this month, MoneyMe reported record growth originations for Q2 to date, while FY22 revenue is now expected to storm past FY21.

After passing the $1 billion mark in Q1 loan originations, MoneyMe reported record originations of $170m for the first two months into Q2 FY22,  a compelling 286% on the same time last year.

 

Autopay shines

The company’s bespoke automotive financing platform, Autopay, continues to shine and has now passed the $100 million milestone in originations in only seven months since launching in April 2021.

Around $68m of those auto loans originated in October and November alone, resulting in $111m of gross customer receivables.

“The November FY22 year to date results highlights Autopay is gaining significant traction, with dealerships and brokers signing up to the new platform and a faster than expected take-up from car purchasers,” Howes said at the time.

Howes said Autopay is a breakthrough innovation, where dealers and brokers can offer a customer driveaway finance within 60 minutes.

This article was developed in collaboration with MoneyMe, a Stockhead advertiser at the time of publishing.

This article does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.

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