Credibly, an American fintech lending platform, has announced the acquisition of speciality finance company ProApprove.
The acquired firm offers home improvement financing services to customers with prime, near-prime and non-prime credit.
The acquisition gives ProApprove access to Credibly’s data science, technology, and risk management capabilities.
ProApprove leverages its network of home improvement contractors to originate instalment contracts allowing them to cater to customers across the credit spectrum.
Credibly, which is focused on catering to small and medium-sized businesses (SMBs), did not disclose the terms of the transaction.
Concurrently, Credibly announced a forward flow agreement with an alternative investment firm Castlelake.
The agreement will see Castlelake buy up to $350m in home improvement instalment contract receivables from ProApprove, which will service these contracts.
Credibly co-founder and co-CEO Ryan Rosett said: “Through conversations with contractors who obtain financing from Credibly, we identified a significant market opportunity in the home improvement space.
“We believe our agreement with Castlelake will accelerate our expansion efforts by providing contractors with confidence that they can offer flexible financing solutions to all of their customers.
“Contractors who offer financing solutions through ProApprove will no longer need to turn down sales due to a homeowner’s inability to pay for a project upfront, helping those contractors grow their book of business.”
Credibly, which was founded in 2010, claims to have offered over $10bn in capital to SMBs. In September 2019, Credibly formed an alliance with Wirecard to digitise its funding process.