Fresh from its foray into Guyana, Jamaica-based micro financier Dolla Financial has raised $225 million to aid in its regional push.
The funding was secured earlier this month through a private debt-raise with an institutional investor. This brings to $425 million the amount of money raised by Dolla Financial since the start of the year to beef up its loan pipeline.
In June of this year Dollar Financial raised JM$200 million in a private placement brokered by GK Capital. When contacted, Dolla Financial Group CEO Kadeen Mairs told the Jamaica Observer that, having secured this capital, the company is now looking to continue its regional push.
He disclosed that Dolla Financial, which is owned by Dequity Capital and First Rock Private Equity, is now prospecting the region to set up location.
“We are contemplating going into other locations across the Caribbean. We are getting legal advice from attorneys in the various regional jurisdictions on the legal framework in their locations, such as the Money Lending Act, so in essence we are doing our due diligence,” Mairs explained.
He added that directors have been travelling throughout the region doing their own prospecting, noting that their search for market is concentrated within the Caricom region. To date, the company has eight branches in Jamaica with close to 3,000 clients across all locations in Jamaica and Guyana.
Sunday Finance quizzed Mair about plans to go public next year through an initial public offer (IPO) to raise more funds for the Caribbean expansion. However, he would not be drawn into commenting on the matter. In spite of his non-commitment in giving a substantive response to queries, Sunday Finance can confirm that Dollar Financial has hired VM Wealth as its financial advisors, as the micro finance outfit prepares for its IPO in 2022.
Mairs made the point that through VM Wealth, Dolla Financial has been tapping the capital markets over the years to raise debt, “so looking at a public offering to raise equity doesn’t sound like a bad idea”.
Commenting on the just-concluded JM$225-million fund-raise, Mairs highlighted the importance of the fund-raising activity, noting that “this strategic move by the company was undertaken, as it saw consistent growth in the loan portfolio”, which he estimates to be upwards of $750 million by the end of 2021.
He argued that Dolla will “continue to raise funding to further on-lend. There is a constant need in the market for the ‘everyday man’ to have access to funding to grow their businesses at their pace and not at the pace of the lender”. He stated that “in order to help the economy recover and adjust to living with COVID-19, it is important that we fuel the rejuvenation of micro, small and medium enterprises who are the backbone of our economy”.
Dolla Financial generates the majority of its income from loans to clients within the tourism and business process outsourcing industries, but is looking beyond those sectors for organic growth, through three new products. These are Medi-Pay, which offer clients loan for cosmetic surgery, including body contouring procedures, dental braces and retainers; Four-Pay, a buy now, pay later facility, which offers customers shopping online the ability to pay for the item in four monthly installments; and One and Move, which is directly targeted at taxi operators.
According to Mairs, “We are projecting at the end of this financial year to double our loan book from both organic growth and acquisition.”