The Wisr Ltd (ASX: WZR) share price is is flying higher today after the small-cap ASX fintech released a promising trading update.

At the time of writing, Wisr shares have rocketed 32.26% to 20.5 cents. This takes the company’s year-to-date share price gain to just over 30%.

Wisr is an online lender that originates personal loans between $5,000 and $50,000 with 3, 5 and 7 year maturities to Australian consumers. These loans are either retained to maturity or on-sold to retail, wholesale and institutional investors.

What did Wisr announce?

This morning, Wisr revealed that the company has returned to pre-COVID-19 loan origination levels. Wisr attributed this to its rapid response to COVID-19 trading conditions and its low exposure to high-risk COVID-19 sectors.

Despite the company’s tight credit policy, Wisr reported $23.1 million in new loans originated in the first two months of Q4FY20. This comprises $9.3 million in April and $13.8 million in May, which represents 48% month over month growth.

Along with May marking a return to pre-COVID-19 loan origination levels, May also saw new records in total weekly settled loan volume.

Wisr noted that it retains support from all of its funders, with the majority of loan originations in April and May settled into the new Wisr Warehouse. This loan facility is backed by National Australia Bank Ltd (ASX: NAB) and went live at the end of November 2019.

As at 31 May, $10.3 million or 6.7% of total portfolio loan balances are on a COVID-19 related payment referral. This comes as the company provided 395 customers (5.8%) with COVID-19 relief packages during the period 1 March to 31 May 2020. Wisr highlighted these loan deferral rates compare favourably to industry-wide deferral rates for residential mortgages and business loans.

Hiccup in new product launch

Additionally, Wisr reported a slight delay to the launch of its secured vehicle product. The company was poised to launch this product to market in Q4FY20, however, plans have changed in the wake of COVID-19.

“As widely reported, the entire auto sector experienced significant disruption in April and May due to COVID-19 social distancing measures, including inability of buyers to inspect vehicles,” Wisr stated.

As a result, Wisr will roll-out the secured vehicle product across all channels in Q1FY21 in order to maximise the impact of the launch.

Management commentary

Commenting on recent trading conditions, chief executive Anthony Nantes said:

“Our key origination and risk metrics are showing that Wisr’s purpose-led model is driving growth and revenue in line with risk appetite and above management expectations.”

“We expected a period of heightened customer hardship stemming from COVID-19. However, this impact has been very manageable in light of the Company’s very small balance sheet loan exposure, prime customer base and exceptionally low exposure to high risk sectors. We are now back to pre-COVID-19 levels for customer support requests.”

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Looking to top up your share portfolio? I think ASX tech shares provide plenty of choices.

Australia’s tech sector is growing rapidly, despite being quite small compared to the US market.

Here are two of my top picks right now: Carsales.com Ltd (ASX: CAR) and Bravura Solutions Ltd (ASX: BVS).

Carsales

Carsales has grown strongly over the past few years. In Carsales FY20 half-year report, it showed that between H1 FY16 and H1 FY20, the company managed to grow revenues at an impressive compound annual growth rate (CAGR) of 12%. Earnings before interest, tax, depreciation and amortisation (EBITDA) also grew strongly. EBITDA increased at a CAGR of 9% over the same period.

In its most recent trading update, it revealed that during mid-March to mid-April, car lead volumes were down 25% on normal levels. However, with lockdown restrictions easing, it is more than likely that lead volumes are now picking up.

This tech share has successfully built on its entrenched and dominant position in Australia over the past decade. This has helped to create a protective moat against market competition. This is despite slowing growth in the maturing online auto classifieds market locally.

Most of Carsales’ new growth is now coming from its overseas operations. These divisions now represent 23% of look-through revenue and 18% of look-through EBITDA. I believe that its overseas operations will fuel further strong growth over the next 5–10years. This positions the ASX tech share well for above-average share price growth during that time.

Another ASX tech share to consider: Bravura

Another ASX tech share worth considering is fintech operator, Bravura. It provides mission-critical enterprise software solutions. It services both the wealth management and funds administration industries.

The company provides software solutions for a range of financial products. These span from wrap platforms, superannuation and pension products to life insurance and portfolio administration offerings.

The company’s main operating markets are Australia, New Zealand, the United Kingdom, and South Africa. An impressive blue-chip client list includes the likes of Mercer, JPMorgan, Prudential, and Citi.

What really attracts me to this tech share is that it is a capital-light business model. It is also underpinned by a strong balance sheet.

The company’s flagship offering in Sonata is a next-generation wealth management administration platform. Its market appeal is that it enables users to interact with their clients through a range of devices. Demand for this flagship product continues to grow strongly.

Bravura has not seen a significant decline in demand during the coronavirus pandemic. In addition, the company recently reaffirmed its earnings guidance for FY 2020.

I believe that Bravura is well positioned for strong growth over the next 5–10 years.

More reading

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• Why I’d buy Appen and these ASX growth shares for the 2020s

Phil Harpur owns shares of carsales.com Limited. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of Bravura Solutions Ltd. The Motley Fool Australia has recommended Bravura Solutions Ltd and carsales.com Limited. 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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