Tic:Toc strikes $25bn funding deal with Bendigo

Online home lender Tic:Toc has struck a seven-year $25 billion home loan funding deal with Bendigo and Adelaide Bank as the fintech’s loan volumes continue to soar. 

The lending agreement between the digital platform and Bendigo will allow Tic:Toc to boost its monthly volumes by more than 300 percent, Further, it signals Bendigo’s continued confidence in the strength of Tic:Toc’s operating model. 

Tic:Toc operates on its proprietary AI-driven lending platform, which digitises the lending fulfilment process into simple, machine-driven tasks. This innovative model has enabled Tic:Toc to deliver its market-leading customer experience, operational efficiency, and credit performance. 

Bendigo, which holds a 28 per cent interest in Tic:Toc, funds the Adelaide-based fintech’s branded home loans. 

“This extension of our partnership gives Tic:Toc access of up to $25bn of additional funding over the next seven years and highlights the competitive advantage of our asset-light model, with Tic:Toc not bearing credit or interest rate risk, said Anthony Baum, Tic:Toc’s founder and chief executive. 

Baum said the partnership with Bendigo enables Tic:Toc to operate as a platform company, rather than a bank or finance company. “This means we achieve a greater return on capital as we’re investing our shareholders’ funds into our technology, not using it to fund loans. 

“Ultimately, Tic:Toc wants to help more Australians access faster and more cost-effective home loan experiences. We’ve been doing that since 2017, and this funding agreement ensures we can not only keep doing this but advance our lead as Australia’s pre-eminent home loan platform.”            

Highly efficient 

Bendigo’s head of third-party banking, Darren Kasehagen said Tic:Toc’s innovative proprietary platform enables the bank to benefit from highly efficient home loan fulfilment and superior asset quality. 

“We have seen significant growth in our residential lending activity via third-party channels, and Tic:Toc is an important strategic partner for us to grow our market share.  

“We are excited to announce this market-defining distribution agreement with a partner that shares our commitment to innovation and customer experience excellence for Australian consumers.”  

Interestingly, the Mozo financial comparison website reports that Tic:Toc is now offering one of the lowest variable rate home loans in the market at 1.89 per cent for borrowers who do not need mortgage insurance. 

Mozo estimates that Tic:Toc’s standard variable rate is almost half the average cost of taking out an equivalent product with one of the big four banks. 

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