FinTech: U.K. Digital Lender Molo Raises £266M As The Pandemic Boosts Demand
U.K.-based online mortgage lender Molo received a mix of debt and equity in its Series A round.
Digital lender Molo, which focuses on buy-to-let purchases or remortgages only, raised £ 266 million to cater to a sharp rise in mortgage applications since the onset of the coronavirus pandemic. (altfi)
The raise comes as a second tranche in the start-up’s Series A round of funding. The firm raised £ 10 million in January 2020.
The latest fundraising was led by Macquarie, an Australian multinational investment bank, and Patron Capital, a pan-European institutional investor focused on property-backed investments. The equity round was led by Yabeo, an international Venture Capital firm, and supported by existing shareholders Andenes Investments, GPS Ventures, and others.
The rising popularity of digital services, post-Covid, also had a favorable impact on online mortgage lending. Molo’s promise of a mortgage in minutes, and it’s very simplified procedure, led to a surge in mortgage applications after the pandemic.
According to the lender, its pipeline of buy-to-let mortgage applications exceeded £ 500 million in the months of August and September alone.
The company says on its website that it doesn’t yet offer residential mortgages.
However, according to mortgageintroducer.com, UK Prime Minister Boris Johnson has asked his ministers to work on plans so that more mortgages could be offered with a lower deposit. Also, banks would not be required to ask applicants for detailed information on their earnings and expenses.
“We need mortgages that will help people get on the housing ladder even if they have only a small amount to pay by way of deposit,” Johnson said. “It could be absolutely revolutionary, particularly for young people.”
Meanwhile, Molo said in a statement that its technology was unique to the UK mortgage market. It combined automatic decisions and human expertise to deliver mortgage loans quickly to its customers.
“We are applying the convenience and speed of today’s technology for today’s customers,” said Francesca Carlesi, CEO and Co-Founder of Molo. “Leveraging instant decisions and real-time data validation, customers can get certainty about their mortgage directly on their mobile, in minutes rather than weeks.”
Since its launch in late-2018, Molo has processed £ 1.5 billion worth of loan applications, according to The Times.
Customer searches for buy to let mortgages have jumped by 30% between the first and third quarters of the year, The Times said.
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