The RAIZ Invest Ltd (ASX: RZI) share price finished the day up 4.76% to 77 cents a share. The gains came after the company released a positive business update, which was headlined by funds under management (FUM) growth of 5% from last month to $500.06 million.
Raiz is a fintech company that operates in Australia, Indonesia and Malaysia. The Raiz platform allows Australian customers to micro-invest the remaining round up of everyday purchases in exchange traded funds.
What moved the Raiz share price today?
According to the update, in Australia, Raiz’s FUM grew by 27.9% versus the previous corresponding period (pcp). In addition, both retail and superannuation saw gains of 5.4% and 2.6%, respectively.
Given Victoria only emerged from its lockdown late in the month and there was a global stock market sell off in the last part of the month, the company believes this bodes well for the remainder of Fy21.
It goes on to detail that Raiz saw an increase in active customers of 3.7% month on month, and a 43.8% increase against pcp.
Ongoing growth
In an email to shareholders released as an announcement today, CEO George Lucas commented on the impact this recession is having particularly on young Australians, who make up most of the company’s core customer base.
Mr Lucas went on to say:
Raiz remains on an upward trajectory, and the growth in Active customers and FUM positions us to deliver a solid result. This is also validated by many of our institutional shareholders, such as the Thorney Investment Group, that have also noticed our achievements and increased their holding in Raiz Invest over the past few months.
He also highlighted the company’s growth in Southeast Asia, an area where the product only commenced in FY20:
In Southeast Asia, trends continue to be pleasing. In Indonesia, the three-month gain for Active Customers is 84%, while in Malaysia it’s 311.6%. The monthly gains in October, 10.9% in Indonesia and 22.5% in Malaysia, illustrate growth is being maintained despite business conditions remaining difficult because of COVID restrictions and lockdowns.
The path to this update was detailed in the company’s FY20 performance, which outlined how Raiz, against strong headwinds of the pandemic and economic recession, was able to achieve significant growth. For example, FY20 revenue per customer in Australia increased by 71.4%. FUM increased by 30.6% to $453.6 million, meaning it has taken only 3 months to grow an additional $50 million.
Also of note is the company’s change in leadership management. George Lucas is moving to a group managing director role. Meanwhile, Brendan Malone, who is group COO, will also become CEO of the Australian business.
The Raiz share price has grown by 24.19% over the past 6 months.
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Motley Fool contributor Daryl Mather has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.
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