Debt collection tech company Credit Clear has now closed more than $100m in digital payments. It also secured another $1.17m in its expected revenue pipeline for the next 12 months after winning significant contracts in July.

Payments on the Credit Clear’s (ASX:CCR) platform have grown rapidly, and this week they’ve ticked over the $100 million mark.

While $100m is a great milestone, it was the pace at which it was done which made it more impressive, taking four and half years to get to $50m in digital payments, and only 17 months to double that to $100m.

In the last four months, CCR has set new records in terms of digital payments, posting a record Q4 quarter with $13m collected, while around $50m came in the last five months.

35 new clients in July

And following its maiden profitability for the month of May, Credit Clear (ASX:CCR) has now signed 35 new clients in July that collectively are expected to add another $1.17m in revenue over the next 12 months.

Of particular note is the significant growth in commercial client wins (where the debt is owed by a company), which CCR has previously identified as an area of strategic growth.

This growth follows the appointment of Chris Hayes as CCR’s head of commercial (ARMA and Credit Solutions), who’s brought with him over two decades  of experience and relationships in commercial collections.

July also saw the onboarding of a large Australian water utility customer within the consumer team.

CCR believes that utilities are an industry sector where the company’s offering is proving to be attractive, with a lot of interest in that category now building in the pipeline.

In total, 2022 has proved to be a strong year for CCR, where cumulative expected revenue from new clients has now totalled $10.35 million:

  • January – $1.6m
  • February – $1.5m
  • March – $2m
  • April – $2m
  • May – $1.5m
  • June – $580k
  • July – $1.17m

Credit Clear CEO, Andrew Smith, says this performance in 2022  is an indicator of future growth.

“Credit Clear finished FY2022 strongly and has continued its performance into FY2023,” Smith said.

“New client wins are a strong indicator of future revenue growth, and the performance of our commercial team in July was particularly pleasing.”

‘Superior offering’

The wins are also a reflection of Credit Clear’s superior technology and offering when compared to its peers.

In the insurance sector, the company was named as an Insurtech finalist in the 2022 Australian and NZ Institute of Insurance and Finance (ANZIIF) industry awards for its digital third-party insurance claims system.

CCR’s completely digital (no human contact) third-party collection solution is well known in the industry, and has shown to improve engagement and collection rates, significantly reducing the time to recover debt.

CCR’s onboarding process also continues to improve, and several new clients signed in the past few months have grown faster, and are providing more customer accounts than originally anticipated.

“For example, a financial services client onboarded earlier this year was thought to be worth $1.5m over 12 months. However, their account referrals in the past month are well above their expected monthly referral rate,” Smith explained.

Smith believes that CCR is winning more work from existing clients for two major reasons.

“First, it’s because of our superior performance over competitors on the same collection panel.

“And second, because our clients have greater volumes of debt files, given the rising cost of living and stagnant wage growth,” he said.

Growing fast

Credit Clear has met many of its strategic objectives and grown significantly since its ASX listing in October 2020.

In those two years, the company has successfully commercialised and scaled its technology, acquired leading debt recovery business ARMA, achieved operational run-rate profitability as well as significant organic growth.

Despite the achievements, the CRR board has continued an ongoing process of review and renewal as part of its longer-term strategic planning.

As announced earlier this week, Credit Clear co-founder Lewis Romano has stepped down from the board to dedicate his time to focus on the new role of Head of International.

CCR believes there are significant opportunities to grow the company’s presence in global markets in countries such as South Africa, where Credit Clear has an existing Partnering and Teaming Agreement with Techub.

Elsewhere in the  UK, CCR is in discussions with a large UK-based multinational BPO and debt collection service provider, and  in Singapore CCR is currently considering a new licensing agreement.

The board says it expects to make further announcements on these discussions in the near term.

Strong position

Smith says that from a debt industry perspective, CCR’s strategic positioning as a fully integrated, end-to-end provider of debt collection services puts the company in a significantly stronger position than other providers.

“Digital only collection providers have struggled to gain real traction or volume of business, and those not yet profitable have struggled to raise new capital to fund operations,” he said.

“Debt purchase providers have also experienced a challenging environment, with rising cost of debt, interest rates and their own operational performance challenges.”

“Credit Clear, with award-winning digital technology, empathetic and highly-skilled agents, and experienced legal recoveries, is winning business because we provide our clients with a better collections experience and our clients’ customers with a better customer experience,” Smith added.

This article was developed in collaboration with Credit Clear, a Stockhead advertiser at the time of publishing.

This article does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.

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