Clayton Howes speaks about the funding facility and business as well; not a lot more than what is on the ASX release....why he is talking about Asia/Europe when she asked about the car market seems a waste of time, but towards the end he repeats the 10m cash is a 'game changer' for the business.
I suspect yes it releases 10m now, but the benefit (if I've interpreted this correctly) is how this facility will work wrt the car loans - it appears that the facility will allow MME to not only provide funds for the car loan, but also allow MME to borrow in order to fund the commissions they pay upfront. I believe that this has restricted business because they earn interest/fees/etc over the term of the loan, but have to pay the referral commission upfront (so MME was having to use its own cash to pay commissions and slowly earn that back over the term of the car loan).
So essentially, it's not only the borrower that is getting money from this facility, but also MME who is using this as a loan facility to pay the agents commission. They are paying interest on this loan, but arguably, it does not tie up their funds for 3-4-5 years which is what it takes to earn that commission from the monthly payments they get. You'd want to hope that they are paying a lower interest on that component (compared to the actual car loan), but it frees up the cash they are generating from the business for other things.
The proof on how big a game changer this will be is what they loan book will look like by June......not a bad time given financial year end and the regular writeoffs that apply to tradies etc so there should be some momentum there (fingers crossed)
MME Price at posting:
7.4¢ Sentiment: Hold Disclosure: Held
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