Creditreform Rating has set the corporate rating of SeQura Worldwide to B- with stable outlook. The current rating attests a moderate level of financial strength (creditworthiness) to SeQura Worldwide, which represents an increased default risk in comparison with the sector and the overall economy.
The business model structure of SeQura is based on innovative FinTech products. Positive rating factors are the growth of the loan book and the rapid growth of the client base since inception, as well the strengthened equity base of the company thanks to the capital increase, however we do not see any probability of meeting the company targets for the coming years. Negative rating factors are the currently high refinancing costs, rising default rates, and the focus on Spain. Furthermore, there is a high level of competition for market share in the FinTech-lending sector and low entry barriers for other start-ups. In the medium term, the development of the competition in the lending market (with possible market consolidation by larger companies), and its impact on the margins, remains to be seen. The development of SeQura depends on the overall development of the e-economy and of consumer credits. Furthermore, the ability of SeQura to remain flexible and technologically up-to-date, generate high volume of transactions, retain customers, continuously increase efficiency by generating economies of scale, as well as to manage credit risks by keeping low default rates for a FinTech company, will be decisive. Possible regulation to limit APR, or regulation regarding the use of personal data, as well as current political risks in Spain, may limit the company´s growth. The one-year rating outlook is stable. The outlook is based on the interim financial statements of SeQura as of September 30, 2018 and reflects our assessment. The creditworthiness of the company largely depends on the evolution of the loan book.