Micro-investing app Raiz (ASX: RZI), which encourages users to invest small amounts regularly, is launching a new product feature—Raiz Plus. Raiz Custom portfolios will now be known as Raiz Plus portfolios, providing customers with the ability to add individual ASX stocks to portfolios for a bespoke investing experience.
This lets users build fully personalised portfolios including ASX listed companies alongside existing ETFs, bitcoin, and Aussie residential property.
Raiz Invest CEO and Managing Director, Brendan Malone, said, “Providing our customers with the ability to invest in some of the largest companies listed on the ASX breaks down the barriers for all Australians to learn more about investing and financial markets. Raiz Plus offers customers a new fractionalised capability that has no minimum shareholding and unlimited investments.”
However, as Raiz makes this strategic transition, some changes will be implemented to its fee structure. The monthly maintenance fee for Raiz Plus portfolios will increase from $4.50 to $5.50 for account balances below $25,000 or 0.275% for balances equal to and over $25,000. Likewise, the monthly maintenance fee for Raiz Standard portfolios will rise from $3.50 to $4.50 for account balances below $20,000. For accounts with balances equal to or greater than $20,000, the account fee will remain unchanged at 0.275% per year.
The monthly maintenance fee for Sapphire Portfolios (which focus on Bitcoin exposure) will also increase from $3.50 to $4.50 for all account balances, while the account fee will remain at 0.275% per year. There will be no changes to the existing fees for the Property portfolio or Raiz Invest Super.
Malone added, “A fee increase is always a very considered decision as we seek to balance building the best platform experience and investment tools for our customers whilst also ensuring the long-term financial stability and profitability of Raiz. Our release today delivers a customer driven innovation and enhanced investment capabilities provided at a market low, subscription fee.”
In Q4 FY23, Raiz witnessed positive momentum, with total normalised revenue reaching $4.4 million, a 3.1% increase compared to the prior corresponding period (PCP) and a 1.6% increase on a quarter-on-quarter (QOQ) basis. The platform also experienced a rise in global active customers, reaching 685,263 during the quarter. Australian active customers increased by 2.2% year-on-year (YOY) to 295,943, Indonesian active customers rose by 7.6% YOY to 272,655, and Malaysian active customers increased by 6.3% YOY to 116,665.
Despite the positive financial results, Raiz reported an operating loss for the quarter, partly attributed to one-off costs of over $0.4 million associated with the Successor Funds Transfer migration of the Superestate platform into Raiz Invest Super, as well as staff restructuring. Raiz anticipates a strong operational cash flow positive business in FY24, due to its strategic realignment in its Asian operations that are nearing finalisation.
In May 2023, Raiz launched a Property portfolio, allowing Aussies to invest in the booming real estate sector, and it has already provided exposure to a diversified portfolio of Australian residential properties for nearly 10,000 Australian investors. Furthermore, the Company has taken strategic actions to exit the underperforming Indonesian and Malaysian markets due to their low funds under management (FUM) value. While Raiz enjoys over $1 billion FUM in Australia, it has only managed to accumulate around $1 million in Indonesia.
These decisions allow Raiz to focus on markets with higher growth potential, giving its financial position a boost.
Alinda is a Business Reporter for The Sentiment
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