Paul Mathieson is the Chairman/CEO and Founder of IEG Holdings Corporation with over 19 years’ finance industry experience in lending, funds management, stock market research and investment banking. Paul founded and established a similar business in Australia in 2005 that lent approximately $48 million to over 11,500 customers. Paul permanently relocated to the US in 2008 to replicate the successful business model, utilizing cash flow from the runoff of the Australian loan book to fund US setup. On the back of the success of the Australian Mr. Amazing Loans business, Paul was awarded Ernst & Young’s 2007 Australian Young Entrepreneur of the Year (Eastern Region).
Paul Mathieson is a born entrepreneur, starting his first computer business at age 12 and trading stocks and options at 14. By the time he celebrated his 19th birthday he was an institutional stockbroker and research analyst. “I came from a small country town in Australia but I was always driven to succeed in the global finance world.” he says. “I enrolled in an accelerated Bachelor of Commerce degree program and did three semesters a year, graduating by the time I was 19.” During his 20s Mathieson went to work for Daiwa Securities, the second-largest Japanese brokerage firm, and then took a position as Head of Research for a boutique stock brokerage in Australia before becoming an Investment Banker at ING Barings. “I was heavily involved in researching industrial companies, running IPOs and underwriting committees, and preparing prospectuses. After a short period doing M&A and corporate advisory work for ING, I was approached by a company in the consumer finance space with multiple offices offering personal loans. I spent a month doing due diligence with a view to conducting a potential IPO and that opened my eyes to the industry. Unfortunately, the deal couldn’t proceed because that company lacked the professionalism and the systems to become a fully reporting public company.”
At 25 he started his own significant funds management business. He managed over $130 million of client funds for 5 years and made investors returns via a structured derivatives product he created based on stocks that he researched. A considerable amount of his time was spent building networks of investors and business contacts, and as his 30th birthday approached he was contemplating multiple opportunities. Meanwhile, a university friend working at PricewaterhouseCoopers called and said he was advising a company in the consumer finance space and thought Paul should have a look at it. “I didn’t think much about it until a couple of weeks later when a neighbor also approached me randomly and said he and his friend wanted some advice about a franchise they wanted to buy that was, coincidentally, in the same lending business that my friend was involved with. I guess you could say it was fate or destiny as there were too many coincidences that led to this sector capturing my attention, so I suggested that my neighbor and his friend consider putting $200,000 into a brand-new business instead of buying into a franchise. I believed I could set it up and do better than competitors with superior branding, professional management and a much more cost effective and fairer structure that was affordable to consumers. So, on the first of February 2005, Mr. Amazing Loans was formed.”
According to Mr. Mathieson, “We estimate our targeted consumer finance market to be approximately $50 billion plus per annum in the US equating to approximately 100 times the size of the Australian market where we previously captured 10% market share. Our product is significantly cheaper at 19.9% to 29.9% per annum than the long established payday lending market that have been charging over 300% for many years. There are a lot of people against the payday loan industry and while the Federal Government doesn’t have authority to stop it, seventeen states have enacted double-digit rate caps which basically restrict their ability to operate. Some companies use loopholes but the government is closing in on those too. The Consumer Financial Protection Bureau is implementing measures that apply pressure on unfair practices, and a number of states are increasing regulation of the industry. New York, for example, just shut down the whole payday loan industry and said if you charge more than 25 percent you’re out of business. They also forgave all outstanding payday loans. The Mr. Amazing Loans business is fully compliant with the regulators and positioned to capitalize on the regulatory pressure on the payday lenders.”
“A payday lending product is designed around a consumer needing $500 and being required to pay it back within two weeks at an exorbitant rate. If you haven’t got the $500 one week how are you going to find it the next? Our $3,000 loan costs the borrower $22.23 a week over a five-year period. They can pay it off early with no extra penalties and no extra fees. And if our customer can’t make payments, we can put them on hold until they get back on track. It’s the convenience of what we are doing at a fair rate and it works for everyone. Their payment is so low that it makes very little difference to their weekly budget. That is our selling proposition. These other businesses are based on short-term high returns whereas we set up a model where we are helping the consumer and doing what the government intends. We have received a lot of support for our model and the consumers appreciate the differences. People come to us trapped in a debt cycle from payday loans and we help them out and offer them a much more sustainable position. My philosophy is to try to continually lower our rates as our cost of funding goes down.”
Due to the significant regulatory barriers to entry, there are only a handful of direct competitors to Mr. Amazing Loans. They are OneMain Financial (less than 10% online), SpringLeaf (less than 10% online), Avant Credit (online only but charging significantly higher rates), Lending Club and Prosper (both online only but peer to peer rather than direct lender). The indirect competitors are credit cards, payday lenders with multiple storefronts, online high rate lenders and tribal lender companies operating via tribal exemptions. The competitive advantages over these lenders include significantly lower overhead with a highly lean online model, superior branding, targeted marketing strategy, affordable weekly repayments, a strong management team and regulatory compliance ensuring long term success.
STRONG GROWTH STRATEGY:
Carla Cholewinski, the Chief Operating Officer of IEGH stated “The current economic conditions provide the perfect time for Mr. Amazing Loans to be expanding across the US and rapidly growing our loan book with demand for our loan product at an all-time high. It is rewarding to be able to provide our personal loans to consumers that are neglected by mainstream lenders such as banks and to be part of such a dynamic high-growth organization.”
IEGH is a Finance/Technology company that has established and refined its online operational platform, added more efficient customer online acquisition partners and secured increased funding. IEGH launched online lending in July 2013 with cumulative loan volume rising 765% from $237,000 at June 30, 2013 to $2,050,001 as at June 27, 2014. Loan volumes have grown dramatically due to the recent engagement of seven top national online lead generators with additional lead sources in short term pipeline. In addition, the launch of the new substantially improved www.mramazingloans.com website has significantly increased customer click conversions.
Sam Prasad, the IEGH VP of Corporate Finance stated that “Mr. Amazing Loans continues to set monthly loan volume records and expand across the United States. The platform is now in place for rapid further growth in the second half of 2014 and we look forward to making Mr. Amazing Loans a household name for online personal loans.”
IEGH’s record June loan volumes have grown by approximately 1800% to around $750,000 compared to January’s $40,000 and nearly doubled May’s $410,001 monthly volume. The rapid loan volume growth is being driven by leading online lending website www.mramazingloans.com, new joint venture arrangements with low acquisition cost lead sources and aggressive state license expansion.
IEGH recently received lending licenses in the states of Georgia, Virginia, Missouri and New Jersey and began offering loans online to consumers in these states in late May 2014. The new licenses increased the previous 4 state coverage (Nevada, Illinois, Arizona and Florida) to 8 states and increased the population coverage by 81% from approximately 42 million people to approximately 76 million people. IEGH has submitted applications for licenses in Texas (26.5 million population) and California (38.3 million population). The Company also plans to apply for an additional 23 state licenses over the next 6 months including other large population states of New York, Pennsylvania and Ohio. IEGH’s target is to increase US population coverage by a further 274% from the current 8 states and 76 million people to 33 states and 284 million people encompassing approximately 90% of the US market in the next 6 months.
FUTURE OF IEGH:
IEGH is an emerging growth microcap company in the truest sense and although it still needs to further ramp up its volumes in the US, it has proven the business model works. Paul Mathieson is a proven entrepreneur that has recognized a problem and provided a solution. This niche market has been under regulatory scrutiny due to capital greed by competitors, but Paul seized the opportunity to provide a solution fairly using a practical sensible model. As IEGH expands and executes the Mr. Amazing Loans strategy, increasing corporate revenues will elevate the growth which will increase shareholder value.
“The business of Mr. Amazing Loans is not rocket science, the growth is driven by consistent management execution utilizing our leading online loan platform combined with cost effective customer lead acquisition, thorough and highly efficient underwriting and the ability to access appropriate debt and equity funding. My 5 year vision is to be licensed and lending in most states of the US and also successfully operating online under the Mr. Amazing Loans brand in Australia, Philippines, Canada and United Kingdom. We would like to be the McDonalds of small loans across the world. We aim to be NASDAQ listed with a $1 billion plus global loan book continuing to provide a great product for our customers and fantastic returns for our investors.”
- IEG Holdings Corporation (“IEGH”) is an OTC Pink Sheet listed US public company providing direct online consumer finance in 8 US states with plans to expand to a total of 33 US states by late 2014
- Provides $3,000 - $10,000, 4 to 5 year, unsecured, online personal loans at 19.9% APR – 29.9% APR with zero application fees, establishment fees or prepayment penalties
- Affordable weekly Principal & Interest repayments: $22.23/week for a $3,000 loan and $37.04/week for a $5,000 loan
- Offers loans under the consumer brand “Mr. Amazing Loans” via www.mramazingloans.com
- State-licensed online installment lender regulated by US state Financial Institutions Divisions; compliant with all laws and the “spirit” of the regulations unlike payday lenders, tribal lenders or other fringe lenders
- Funds new loan originations via $10m senior revolving credit facility and secured a $5m equity line Dec 2013
- Commenced lending in Georgia, Missouri, Virginia and New Jersey in late May 2014
- Conducting a 1:100 reverse stock split/filing S-1 in July 2014 and intends a NASDAQ up-listing in April 2015
For more information about IEGH, visit www.investmentevolution.com, www.mramazingloans.com, www.otcmarkets.com/stock/IEGH, email email@example.com or call Paul Mathieson Chairman/CEO at 702-227-5626
The company paid consideration to SNN or its affiliates for this article.
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