At a time of great upheaval in the doorstep lending market, the number two player Morses Club has reported strong annual trading with a rise in both credit issued and customer numbers.
The Batley-based firm said total customer numbers rose 2.6 per cent to 235,000 in the year to February 23 while the company’s gross loan book has grown by over 7 per cent. This was due to a 5 per cent increase in the core book and 2 per cent came from the recent acquisitions of Eccles Savings & Loans and Hays Credit.
The trading update comes as the competition watchdog said it is looking at the market impact of a union between subprime lenders Non-Standard Finance and number one player Provident Financial, after Bradford-based Provident spurned a surprise £1.3bn takeover bid by Non-Standard Finance earlier this week.
Morses Club said its trading performance for the year to February 23 was strong and in line with the board’s expectations. Total credit issued rose 2.4 per cent to £178.5m.
Paul Smith, chief executive of Morses Club, said: “We are delighted by the strong performance we have delivered this year, achieving consistent growth both organically and through acquisitions.
"The significant consolidation we are seeing across the home collected credit sector is continuing and the fragmented marketplace has enabled us to make high quality acquisitions, expanding our regional presence.
“The quality of our service and products, which are designed around the needs of our customers, remains paramount as we develop our digital platform and increase our online offering in line with our product diversification strategy."
The firm said the positive momentum surrounding the growth of the Morses Club Card has continued. The group's first cashless lending product now has 30,000 customers with £15.5m of loan balances on cards.
Earlier this week Morses Club bought smaller rival WageDayAdvance out of administration for £8.5m in cash.
The deal follows the recent announcements of two small acquisitions in the home credit market - Eccles Savings & Loans and Hays Credit.
WageDayAdvance provides online loans in the non-standard credit market. All of its current employees will switch over.
Morses Club said the acquisition fits well with plans to increase its online offering in response to growing demand.
In Thursday's trading update, Morses Club said the acquisition represents a major milestone in the company’s product diversification strategy, as it develops digital products to meet the changing needs of its customers and to broaden its customer base.
Mr Smith said: “We are confident in our outlook for the coming year, which we expect to be reflected in an increased 2019 dividend payment for shareholders.
"We continue to pursue opportunities for growth in both our core home collected credit market and across the wider non-standard finance sector.”