The fintech firm Carmoola claims it will be offering “dealership-beating car finance rates” to win over car buyers now it has secured a major new debt facility worth £100 million with NatWest.
The ambitious direct-to-consumer lender hopes to deliver billions of pounds of new loan originations in the next five years as a result of the deal with NatWest, and it claims the future of car loans is in direct provision, not via dealership point of sale finance.
The company, which was incorporated in 2020, said the funds will enable Carmoola to “broaden and better serve its customer base, offering dealership-beating car finance rates and further enhancing the car buying experience versus traditional dealership financing”.
Its website currently states a representative 15.7% APR but rates as low as 6.9% APR, plus a TrustPilot trust score of 4.9 out of 5 from almost 2,000 reviews.
Carmoola stated that traditional car financing often involves hidden fees and big commissions and its direct-to-consumer approach ensures that borrowers get better rates, helped by its use of technology to eliminate the extra costs, paperwork and uncertainty typically associated with car financing.
Carmoola’s chief executive and founder Aidan Rushby (pictured) said: “Through this new deal with NatWest, we’re again showing our commitment to putting customers first, at a time when our hassle-free and user-friendly approach is needed more than ever.
“We’ve been working on this partnership for some time, and I am so excited that we can now provide our customers with even more amazing rates.”
Rushby added: “This partnership not only enhances our ability to offer dealership-beating rates, but also underscores a shift in the industry. The future of car financing is direct-to-consumer, and we are at the forefront of this change.
“Our goal is to make car financing as straightforward, transparent, and cost-effective as possible, and this deal will help us do that for even more car buyers.”
The most recent accounts for Carmoola Group at Companies House, for its financial year to November 30, 2023, show revenues of £2.8 million and a £5.3m operating loss.
Created by a team of British and Ukrainian former Movebubble and Zoopla executives, Carmoola launched its app in March 2022 and earlier this year secured another £15.5m in venture capital funding, including some from JLR’s InMotion Ventures investment arm, following its £8.5m Series A round in 2023.
George Ross, managing director and head of speciality finance at NatWest, said: “We’re proud to partner with Carmoola, who are doing great things in the car finance industry and driving innovation in the sector. This £100 million deal is a vote of confidence in Carmoola and a commitment to the financial wellbeing of car buyers across the UK.”