Aforti Finance S.A. joined the marketplace in March 2016 and offers Poland-issued business loans for investment listed in Euro (EUR) and Polish zloty (PLN) on Mintos. Since its launch on the marketplace, around EUR 7 million has been invested in its loans. The company is part of Aforti Group which has recently announced it plans to expand the group’s operations dramatically and move its operations to the main market of the Warsaw Stock Exchange by the end of 2018 / beginning of 2019. We thought this was a great opportunity to invite Katarzyna Wieczorek, the Managing Sales Director and Piotr Zieliński, the Director of Analysis and Credit Risk from Aforti Finance to tell us more about the company and its future plans.

1. Tell us about Aforti – who are you?

Katarzyna Wieczorek: Aforti Finance S.A. is a company specialising in granting non-bank loans to small and medium enterprises (SMEs) and the microenterprise sector. Our products are mainly dedicated to people with hindered access to financing their activities due to the restrictive requirements of bank regulations in Poland. We have a unique and fast customer assessment system,  which allows our customers to easily obtain funds.

Our services are offered to both small businesses, who are just beginning to gather capital, and to experienced and established businesses. In addition, we also offer financial assistance to micro-sized, small and medium-sized companies looking for more convenient ways to finance their own operations and development.

2. What does the lending process look like?

Katarzyna Wieczorek: Our lending process is very simple and it is easy to describe in several points. First, the borrower needs to submit a loan application. Then, the application is verified in terms of completeness of documents. Later, all documents are sent for analysis and, if the borrower is approved, we draw up an agreement which is transferred to the customer for approval. The final stage is, of course, the signing of the agreement, which is delivered to the customer in person to sign. Once the agreement has been signed, the funds are quickly paid to their account. This amounts to a fast, convenient and transparent process.

3. What is the average loan type you give to your customers?

Katarzyna Wieczorek: Based on data from 2017, the average loan was around PLN 78 000. Our clients most often take a repayment period of 16 months. We offer several types of loans which can be adjusted to individual needs – the latest is the Gold loan – this product was awarded the prestigious Expert’s Laurel prize, granted in Poland for the best products, brands and services available on the market. The amount of this loan can reach up to PLN 150 000, has a repayment period of up to 36 months and can be used by sole proprietors, civil law companies and SMEs.

4. How do you plan to develop your business in Poland?

Katarzyna Wieczorek: Currently, we offer our loans through our many branches throughout Poland. Developing and expanding these in each large city in the country is one of our main focuses. In addition, we want to reduce the time it takes for our customers to apply for one of our loans to a minimum. We plan to achieve this with a new system we are creating which will allow our customers to submit applications online and eliminate paper applications. After the implementation of the system, our customers will be able to submit their loan application on our website, or during a telephone conversation with our team. We want to reach entrepreneurs who prefer the convenience of applying for a loan online.

At the same time, we are also working on improving our analysis practices. Our aim is to shorten the time it takes to evaluate a customers creditworthiness and we will do this by using Kontomatik – an API that allows financial institutions to access customers’ banking activity. In the near future, we are also planning to open a sales call centre.

Speed and efficiency is the essence of our market advantage. When observing market trends, we notice many details of our competitors, and we see there is the potential for further development of our services.

5. Who are the customers of Aforti?

Piotr Zieliński: Borrowers of our loans come from a broad selection of industries. Our services are used mainly by entrepreneurs from industries related to wholesale and retail. However, a large percentage of our customer base also consists of entrepreneurs who are involved in transportation and logistics. Recent analysis has also shown that Aforti Finance services are being used more frequently by the construction and processing industries. With borrowers from such a large scope of industries, it only proves that our services meet the requirements of an increasing number of entrepreneurs.

Our products also help our customers with a large range of problems – such as contractors being late with their payments. In this situation, many micro, small and medium-sized enterprises would have to borrow money to survive on the market. This is where we come in to help. The need for our services in Poland can be seen in the company’s results as every month there is a clear increase in the number of applications.  

6. What are the needs of your customers?

Katarzyna Wieczorek: The needs of our customers can be classified very broadly. Apart from the situation already mentioned where contractors are overdue with their payments, the most common need of our customers is financial support to supplement a temporary lack of financial liquidity of the entrepreneur. This includes aspects such as the purchase of equipment or specialist tools, investments in employees and other unexpected costs.

7. What are your market advantages?

Katarzyna Wieczorek: Our main market advantage is our clear, fast and accessible lending process. This allows our borrowers to have access to funding very quickly – the longest turnaround is 24 hours. This is because we keep formalities to a minimum, which shortens the time necessary to grant a loan.

8. You joined the Mintos marketplace in 2016, what has this cooperation allowed you to achieve?

Piotr Zieliński: During our operations, we have found that accessing external funding and the availability of this funding is greatly limited. Obtaining a loan from a bank, or bank credit often comes with a long waiting period, an excessively bureaucratised procedure and complex forms for credit security. Apart from funding in the form of issuance of our own bonds, funding loans through the marketplace is undoubtedly one of our main forms of financing.

An advantage of funding on the Mintos marketplace is the flexibility related to the issuance of loans online via API, the possibility for us to determine the amount of interest for potential investors, as well as the quick access to funds obtained from the invested loans. We are very happy with the cooperation and with Mintos and we want to develop that cooperation, among others, by expanding our product offering on the marketplace when we begin distributing loans to borrowers in more European countries.

9. What sets Aforti Finance loans apart from other loan originators on Mintos? Why would investors want to invest in Aforti loans?

Piotr Zieliński: Aforti Finance is a market leader for distributing non-bank finance loans to SMEs in Poland. Investment in Aforti Finance loans guarantees a high return for investors and is secured with a buyback guarantee if the loan is delinquent for more than 60 days. Additionally, Aforti Finance SA is part of Aforti Holding S.A. Group, which fully guarantees to investors on Mintos that the buyback guarantee of Aforti Finance will be fulfilled.  For the above reasons, loans from Aforti Finance S.A. should be an indispensable element for investors’ portfolios on Mintos.

10. Do you plan to develop the company in a global context?

Katarzyna Wieczorek: Yes, our strategy includes development outside Poland. At this stage, we are focusing on markets of European Union Member States and in the Central and Eastern European region.

11. How would you assess the position of Aforti on the lending market? Is there a lot of competition in Poland?

Piotr Zieliński: Currently, Poland doesn’t have many entities offering non-bank loans for SMEs. However, we do not underestimate the existing competition. We always try to be one step ahead, so we are keeping a close eye on what is happening with our competitors on the market of non-bank loans.

12. Do you think the alternative finance industry in Poland has a lot of potential?

Piotr Zieliński: KPMG consultancy firm, which published the Twino Alternative Lending Index report in spring 2017, analysed the potential for development in the alternative lending markets of 23 European countries. In this report, Poland was ranked fourth. The index showed there were two main reasons for this – borrowers wanting to take a loan from a bank in Poland have to go through a long and complex process to get a loan, and the relatively high-interest rate of credit in Poland compared to other European countries. This means there is huge potential for the Polish lending market.

13. Recently, you have recorded significant increases in the volume of granted loans. According to your latest financial information, in February, Aforti Finance granted 51 loans with the total value of over PLN 5.49 million, which – as compared with the same period of the previous year – means a growth by 46% and 233%, respectively. How are you intending to maintain this growth?

Katarzyna Wieczorek: This result is the best in the company’s history and we are extremely proud of it. We do not intend to slow down, and the presented results are a fantastic motivation for us, as well as an excellent development forecast for the upcoming months. We are intensively developing our own sales network – as a result, we continuously achieve better sales results. However, an effective sales process is one thing – another extremely important aspect is seeking and implementing innovative methods to reach our customers. We are also monitoring the current trends and needs of potential customers to make sure we continue to be relevant and convenient for them.

The growth in the volume of loans disbursed clearly indicates that our strategy yields the expected results. Consistency in operation, clearly specified goals and products aligned to the needs of our customers amount to the strong competitive advantage of our company on the Polish market.