Marble Financial executes definitive $10M credit facility agreement with Cypress Hills Partners to fund Fast-Track loan product

Marble Financial Inc said that it has entered into an arm’s length definitive credit facility agreement with CHP Agent Services Inc., a subsidiary of an independent, non-affiliated Canada-based alternative specialty lender Cypress Hills Partners Inc. The Vancouver, British Columbia-based financial technology company said the credit agreement provides for a $10 million credit facility through its wholly owned special purpose vehicle (SPV) subsidiary and “TPFM as servicing agent for originations, administration, and monitoring of the SPV loan portfolio.” The funding is a selected percentage of the SPV’s eligible customer loans, with the initial advance rate set at 95% and a minimum threshold of 80%. READ: Marble Financial surpasses 20,000 member milestone on the MyMarble financial wellness platform “Interest is charged at Canadian Prime plus 13%, with a provisional discount if the advance rate is less than 95%,” said the company. The maturity date for all funds advanced is three years after the first funding advance, with an option to extend for two more years based on mutual agreement. The credit facility will be used to re-engage Marble’s legacy financial wellness Fast-Track program, said the company. The Fast-Track program helps qualified Canadians speed up their credit rebuilding process by exiting a consumer proposal and journeying back to mainstream financial inclusion. Marble said TPFM will continue to originate and decide on the Fast-Track program through its proprietary MyMarble Platform and will manage the SPV loan portfolio and earn the net interest income, including insurance, administration fees and software-as-a-service (SaaS) revenue. “This opportunity will enable Marble to re-engage and greatly expand its Fast-Track program and support the company’s data science and machine learning initiatives towards Marble’s second-generation scoring algorithms,” said the company. Data analysis will provide meaningful insights on future products and solutions for the millions of underbanked Canadians that are excluded from traditional financial services, noted the company. Since the break of the coronavirus (COVID-19) pandemic, Marble said it has received over 2,000 prequalified MyMarble Members looking to enroll in Fast-Track once it becomes available this month. “With a historic average loan size of $8,000 combined with potential SaaS-based subscription revenue, the resumption of Fast-Track creates a large pool of multi-stream revenue opportunity with negligible marketing spend,” said the company. With Canada’s slow recovery from the pandemic and the ending of government-led income subsidiary and deferral programs, a July 2021 Debt Survey by MNP shows that 45% of Canadians are doubtful they can cover living expenses this year, and 30% report being insolvent. The firm said Marble’s Fast-Track program, combined with MyMarble, is a “proven successful solution for this large population of goal-oriented Canadians” who have recently become insolvent, or filed for a consumer proposal caused by a perpetual state of low-income. With experts forecasting that more Canadians are expected to file for consumer proposals, insolvent consumers will potentially increase demand for Fast-Track in the years to come. According to the Canadian Association of Insolvency and Restructuring Professionals (CAIRP), consumer insolvencies have increased by 22.8% in March 2021, compared to February 2021. This marks the largest single month-over-month increase in more than 10 years. “At Marble, our mission is to nourish confidence in Canadians to redefine their financial outlook. This credit agreement enables Marble to continue looking forward to empowering more financially challenged Canadians back to the mainstream economy,” Marble CEO Karim Nanji said in a statement. “The re-commencement of the Fast-Track program is both significant and timely given the current economic circumstances facing Canadians. We are encouraged that CHP believes in our business strategies and has the confidence in our management team to execute on it.” Kelly Klatik, managing partner of Cypress Hills Partners said the re-engagement of the credit wellness Fast-Track program by Marble is “very well timed.” “Cypress Hills looks forward to a long partnership with the Marble as they disrupt the financial wellness space in Canada,” added Klatik. Contact the author Uttara Choudhury at uttara@proactiveinvestors.com Follow her on Twitter: @UttaraProactive