At a time when Buy Now Pay Later companies have disrupted the Australian credit economy, Cash Converters (ASX: CCV) is making a strong comeback in the personal finance sector having transitioned away from their image as opportunistic pawnbrokers.

The renaissance of Cash Converters which has increased marketing spend, evidenced through television advertising that features prominent AFL stars, has been confirmed by the Company whose pawn broking division now makes up just 10% of their total loan book.

Instead, Cash Converters has been a beneficiary of Australians veering toward non-bank lenders with their $171.6 million loan book growing 14% over the past five months and comprising 38% small credit contracts, 27% medium credit contracts and 25% vehicle financing.

“The performance of our underlying business throughout FY 2021 has been extremely impressive considering the substantial impact of COVID-19 on our loan books, with Government stimulus payments impacting borrower demand and accelerating loan book repayments in the first half of FY 2021,” said Cash Converters Managing Director, Sam Budiselik.

“The strength of our business model has remained particularly evident over the past 12 months. A unique model that is difficult to replicate, our customer service proposition has been successfully integrated with our physical stores operating in tandem with industry leading online digital assets, powering revenue growth across our retail and lending businesses.”

Key to the growth of Cash Converters’ personal financing business is the capital investment it has made in its franchise network of stores which act as the primary gateway for personal loans, as well as pawn broking.

Across the financial year to date, Cash Converters has expanded its franchise store network with six new locations across four States, while also opening two Company-owned stores in Western Australia and Victoria.

“Executing a sensible growth strategy remains a key focus of the management team with increasing profitability anticipated throughout FY 2022 and beyond,” said Budiselik.

With this continued growth in their loan book, Cash Converters has resumed its dividend payout policy which was paused during COVID where lost foot traffic impacted its operations significantly. This resumption will see shareholders issued a fully franked interim dividend of 1 cent per fully paid ordinary share at the half-year ended 31 December 2020 when Cash Converters reported $98.4m revenue and $7.7m net profit after tax.