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ChimpChange raises funds to accelerate digital banking growth

The company’s revenue more than doubled in the March 2017 quarter.
ChimpChange raises funds to accelerate digital banking growth
ChimpChange launched a new savings account in April

ChimpChange (ASX:CCA) has successfully completed a placement to institutional and sophisticated investors, raising $10 million at $0.72 per share.

Based in Los Angeles, California, ChimpChange is a digital banking platform providing low-cost, feature-rich bank accounts for U.S. consumers.

ChimpChange will use the new funds to accelerate customer acquisition, product development and finalise build-out of internal enterprise software development capabilities.

The company’s revenue more than doubled in the March 2017 quarter compared to the previous quarter and achieved an annualised A$1 million revenue run rate ahead of forecast.

Furthermore, ChimpChange finished the March quarter with total transaction value running at an annualised run rate of US$118+ million, up from US$56 million at the end of the December quarter.

The company launched a new savings account in April with round-up feature following successful pilot during the quarter.

In the new account, the difference between the nearest whole dollar and the actual purchase price from every MasterCard transaction is saved in a separate round-up account.

The round-up account will grow over time as the customer proactively swipes their debit card.

From a longer-term perspective, ChimpChange expects loan products to drive a step change in the company’s ability to generate revenue (and gross margin) per active customer.

ChimpChange’s share price increased circa 45% since the start of 2017, last trading at $0.81.

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