TORONTO Dec 14 Business has doubled for
Canadian financial technology firm Financeit since it purchased
the home improvement financing assets of Toronto Dominion Bank
and the company is seeking more acquisitions, its
TD sold its indirect home improvement financing assets,
which had a book value of C$339 million ($258 million), in
September, to Financeit and Concentra, a provider of services to
credit unions, in a deal that added more than 800 merchant
dealers to Financeit's portfolio.
Chief Executive Officer Michael Garrity, Financeit's
founder, said in an interview the deal had transformed his
business, doubling its loan value and revenue, and Financeit
would now consider more acquisitions.
"Part of our growth plan is to consolidate the industry," he
said. "We're aiming to build a multi-billion dollar company,
focused on something the banks aren't very good at. Where banks
are playing in that space today, we are active buyers in those
An initial public offering is also "absolutely" in
Financeit's future, but it is not something the company is
thinking about on a day-to-day basis, Garrity said.
Founded in 2011, Toronto-based Financeit seeks to enable
businesses such as home improvement companies to offer
hassle-free payment plans to their customers, with instant
credit checks and competitive interest rates and without reams
of paperwork and long wait times for checks and approval
decisions. Merchants do not pay fees to use the platform.
"That whole transaction happens in under five minutes in a
driveway on a mobile device," said Garrity of Financeit's
The company, which has processed over $1.5 billion in loans,
has quarterly regulatory compliance checks and a fraud
prevention process to ensure transactions are valid.
Financial technology startups, or fintechs, have attracted
increasing attention from banks and are viewed as potential
disruptors to the industry because of the way they are changing
how consumers handle and interface with banking, lending,
payments, and insurance.
This has prompted banks to invest in, partner with, or
acquire fintech startups. The TD deal, which took about a year
to negotiate, is an atypical arrangement.
The company, which only operates in Canada, currently has
about 4,500 active merchants using its platform. Garrity said it
is aiming to enter the U.S. market late next year.
Financeit, which has raised money through a variety of
investors including FIS Global and Goldman Sachs,
is on track to be profitable on an accounting basis in the next
six months, said Garrity.
($1 = 1.3128 Canadian dollars)
(Reporting by Solarina Ho; Editing by David Gregorio)