Yorkshire-based non-standard financial services firm Morses Club sees digital division customer numbers rise by 80 per cent

Financial services company Morses Club today revealed that customer numbers in its digital division for short-term and long-term lending products have increased by 80% since the beginning of the financial year.

Morses Club has provided a trading update for the City of London

Batley-based Morses Club has provided an update on trading for the five-month period ending 31 July 2021.

The statement said: "The group continues to perform in line with expectations and demand has steadily increased across all lending products in both the HCC and Digital divisions.

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"Morses Club continues to make progress towards offering its customers a more complete suite of financial services and products to suit market demand. Customer satisfaction for the HCC division remains high at 98%."

Customer numbers in the digital division for short-term and long-term lending products have increased by 80% since the beginning of the financial year and the customer base now stands at more than 42,000, Morses Club said.

The statement added: "The average product mix continues to move towards longer term loans, with loan book growth at 158% from the year end. This increase in lending volumes has not resulted in a deterioration in credit quality, with collections performance in-line with management's budgeted plan.

"New credit issued is 34% higher than budget. The significant increase in both demand and volume for longer and shorter-term digital lending products has led to the lengthening of the maturity profile of the loan book. The impairment range for the digital division in H1 will increase due to the IFRS9 requirement to take forward-looking provisions at the outset of the loan period."

"Morses Club continues to adapt to a digitalised and structurally changing HCC sector, where 65% of all lending in the division is now cashless and over 70% of the group's customers are registered for the online customer portal. Customer numbers are in line with expectations during the first five months of the year at 144,000. Total credit issued for the period is 18% above management's budgeted plan. Cash collections against target have remained consistent being 5.4% ahead of budget and 12% ahead of the same period last year."

Paul Smith, chief executive officer of Morses Club, said: "Our expanded offering in the digital division along with the continued strong performance in our HCC division is encouraging. Our recently announced proposed corporate restructure is all part of our long-term plans to grow and differentiate our products and services to meet customer demand.

"The group's significant experience in the sector and its commitment to providing best in class HCC and digital products will enable us to take advantage of changes in the market and further strengthen our position as a leading provider of non-standard financial services products in the UK."

Morses Club is also proposing a reorganisation of its business and corporate structure which will involve the introduction of a new, AIM-quoted, holding company for the group, U Money PLC.