Spenda Ltd (ASX:SPX) has entered a $50 million debt facility agreement with a private Australian credit fund to provide capital to accelerate its software as a service (SaaS) business model growth.
The company offers several services through its software – point of sale, inventory management, eCommerce, procurement, service management, accounts receivable and accounts payable – which can be turned on or off modularly depending on the customer’s needs.
Spenda will use this new debt facility to refinance its existing portfolio – which currently yields an average of 19% per annum – and provide a runway for future growth.
Demand expected to continue to accelerate
“Scaling our lending facilities through our debt warehouse puts the company in a strong position to capitalise on forecasted trends in business to business (B2B) payments,” Spenda managing director Adrian Floate said.
“With digital adoption on the rise and growth in global trade, the demand for better payment infrastructure and faster access to working capital solutions will continue to accelerate.
“The addition of in-line, point-of-activity lending services within our Accounts Receivable and Accounts Payable software provides businesses with another tool to combat missing or late payments.
“By shortening the invoice-to-pay lifecycle businesses lower their credit risk and improve their cash flow management, both key drivers in long-term business viability.
“We feel the appetite demonstrated by the market to participate in our fund is a strong indication of our ability to scale via our innovation in both lending and payments that is underpinned by improved collaboration and B2B workflow enhancement.”
The company sees these new funding terms as more favourable compared to its existing facilities, with additional flexibility that will allow Spenda to increase net margin as well as write larger deals that fall within the company’s credit policy guidelines.