It’s 2020, and anything could happen! From the COVID-19 pandemic, to political protests, heart-breaking unemployment numbers and an Australian economic recession which broke the world’s longest recession free streak – 2020 has been a wild ride. 

Last week, Credit Intelligence (ASX: CI1) reaffirmed its profit guidance for the 2020 financial year of A$13.5 million, up 125% on the  2019 fiscal year.

Jimmie Wong Credit Intelligence Founder and Executive Chairman is confident that the growth is set to continue too. 

Credit Intelligence has entered the Australian market with the acquisition of Sydney-based debt negotiation business Chapter Two Holdings. Credit Intelligence also announced this month a share purchase agreement to acquire a 60% stake in Chapter Two.

Mr Wong speaks from experience when he says that when economies take a turn for the worse, more people will require the type of financial solutions that Credit Intelligence provides.

The economic conditions that Australia is about to experience will be the first major disruption to the economy in many decades. Many people will not know how to adjust and adapt to living in a recession. Credit Intelligence can help and provide these individuals and companies with a pathway forward.

Credit Intelligence, through Chapter Two, offers hardship assistance, reduced debt settlements and long-term financial arrangements to Australians unable to maintain their outstanding debts.

The past few days have shown clearly that the way out of COVID-19 induced recession will not be quick or smooth. Many analysts expect it to take some time before the economy returns to pre-COVID-19 levels and many expect things to continue to get worse before it slowly gets better.

According to estimates by research firm Roy Morgan, about 2.1 million Australians were unemployed in early June, equivalent to about 8% of the nation’s population.

Many businesses, particularly in the retail and travel sector, may not recover despite the easing of lockdown measures and Australia’s summer bushfires also had an adverse effect on businesses before the coronavirus pandemic.

The country has one of the highest private household debt levels in the world – almost double its household disposable income level, according to the Reserve Bank.

The Australian Banking Association also revealed in May that one in 14 mortgages were granted repayment breaks due to financial hardship associated with the pandemic.

Credit Intelligence is a trusted partner for Australian individuals and companies as high current debt levels meet surging unemployment. 

“I foresee there will be a fall in the property prices in Australia and many people will lose jobs or have a fall in income, so many people will have trouble repaying their mortgage and debts,” Mr Wong said.

Reach Markets have been engaged by CI1 to assist with private investor management.

Sources:

• Credit Intelligence Limited, June 2020, Investor Presentation
• Reserve Bank of Australia, June 2020, Household Sector
• Roy Morgan, May 2020, 2.16 million Australians (15.3% of the workforce) out of work in April