Finance Company Specialising In Unsecured Personal Loans For Sale

Business description

This business specialises in the provision of home collected credit – unsecured personal cash loans made available over a selection of weekly terms.

The business operates in the highly localised and very suitable area of East Sussex, with exactly the right kind of demographics – the business has built up a widespread, loyal customer base. The collector call on their customers on a weekly basis, to collect payments and to provide customers with on-going credit facilities as required. Customers can pay by cheque delivered by post to the company’s registered address but the vast majority of payments are collected face to face, on the door by a long standing, self employed collector.

Bound by the rules of the Consumer Credit Act 1974( the business is a member of the Consumer Credit Association) and the Data Protection Acts of 1984 and 1998, the business offers weekly loan terms available at varying rates of interest. The business also offers consolidation loan refinance facilities. The business in general offers interest rates of between 365% and 433% APR.

A large proportion of the loans made are higher margin shorter term ‘overlapping’ loans whereby a remaining small balance on an existing loan is cleared from a new loan given, with the customer receiving the balance of the new loan less the amount needed to clear the previous loan.

The business enjoys a 98% retention rate amongst its clients and a collection ration of 85%, compared with an industry average of 65%.

The majority of clients are mums with children, many of which are single mums. Many clients are on benefits and thus have a lower credit limit.

Most loans are currently between £200 to 800.

The business has 259 clients, of which 23.6% are considered Prime, 41.1% Good, 27% Fair, 8% would not be given another loan

Loan book Value is £85,000, annual profit is £67,000.

Customer Service:

Many of the clients are long term customers and the collectors have built up a very positive relationship that is based on trust and reliability. The customer base have almost a feeling of gratitude towards the business.
Financial profile:
The business is being offered for sale on a going concern basis, all financial discussions will take place directly between the vendor and all interested parties under the auspices of Turner Butler.

The loan book value is £85,000 providing an annual profit of circa £67,000 with a collection ratio of 67%

Property information

Location:

There is no property associated with this sale.

Business Operation

Expansion potential:

The business has the ability to grow substantially. New customers at present are generated just through word of mouth referrals. Advertising via the local press, via the internet and via door to door leafleting campaigns would provide a substantial boost to the business.

Competition / Market:

The business does not currently advertise.

Reasons for selling:

The owner is seeking to take retirement.

Trading hours:

Monday – Friday: 4.0 pm – 7.0 pm

Other information

Support & training:

All necessary training and a full handover are available to ensure continuity of trading.