An Post Money to take on pillar banks with mortgages by end of 2019
An Post financial services plan takes aim at SME lending
An Post is planing to enter the small business lending market as part of an ambitious financial services strategy which will see it offer mortgages, personal loans and fintech services.
The semi-state company will launch An Post Money in the spring, adding several new products to existing services such as current accounts and foreign exchange.
Debbie Byrne, managing director of An Post Retail, said An Post has entered into an agreement with Avantcard to offer credit cards and personal loans of up to €75,000 and that it was in discussions with the Department of Finance over SME lending.
Byrne said SME lending would be a key part of its strategy and that it has discussed the possibility of linking up with the county enterprise boards.
"They are a great resource at the moment for small SMEs. They help with business plans, give grants... but they don't provide any cash facility," she told the Sunday Independent. "So if we can link in with the enterprise boards, we could almost be that cash facility at the back."
She said it was too early to indicate what size of SME loans An Post Money would make available.
In a huge development for the mortgage market, An Post is seeking a joint-venture partner to offer lower mortgage rates to both switchers and new business.
Byrne said An Post would hope to have a mortgage partner selected by late spring. "We will cast the net abroad. Irish banks are welcome to submit proposals as well, but we have also looked at international banks that have licences here," she said. "You would be able to get up and running quite quickly.
"We would want to be in the marketing and piloting phase towards the end of next year."
However, An Post would not seek a full banking licence within the next three to five years. "That's not to say we wouldn't do it later," she said.
The strategy also includes developing a fintech offering. "We really need to target that younger customer and we need to have a point of difference versus the pillar banks.
"We'll issue a 'request for information' in the next four to six weeks, looking for fintech providers to come in to present to us in terms of what systems they have and we would be looking to partner and white label," she said. White label is when a company such as An Post uses someone else's technology under its own branding.
"We're looking for a systems provider rather than a product provider," she added.
Sunday Indo Business