Cash Converters

Cash Converters

Company type	Public
Traded as	ASX: CCV
Industry	Diversified financials
Founded	1984 (1984)
Founder	Brian Cumins & Partners
Headquarters	Perth, Western Australia
Area served	Australia Belgium France Malaysia Middle East Netherlands New Zealand Portugal Singapore South Africa Spain United Kingdom
Key people	Sam Budiselik (Managing Director)
Products	Unsecured personal loans Secured personal loans Line of Credit Second-hand retail
Revenue	AUD$382.6 million (FY 2024)
Net income	AUD$20.8 million (FY 2024)
Website	cashconverters.com cashconverters.com.au

Cash Converters International Limited (also simply known as Cash Converters or Cashies) is an Australian ASX-listed, globally franchised retail and financial services company. The company specialises in the buying and selling of second-hand goods as well as providing a range of financial services including personal loans, line of credit, and pawnbroking. The company is headquartered in Perth, Western Australia.

History

Cash Converters store in Port Kennedy, WA

Cash Converters was founded in Perth, Western Australia, in 1984 by Brian Cumins and a group of partners. Within four years, it had opened a further seven outlets across Perth, with the first two franchised outlets opened in 1988.

The company commenced its international expansion in the mid-1990s establishing operations in New Zealand, the United Kingdom, France, Belgium, Spain, South Africa, and other markets. As of 30 June 2024, Cash Converters operated 669 stores across 17 countries, with some non-Australian stores managed through master franchising agreements.

The group listed on the London Stock Exchange (LSE) in 1995 and was then granted a dual listing on the Australian Securities Exchange (ASX) in February 1997. In 2001, Cash Converters migrated its primary listing location to the ASX and subsequently delisted from the LSE on 19 February 2013 based on the composition of its share register and low trading volumes in the UK.

Cash Converters made two acquisitions in 2006. The first, Safrock Finance Corporation, was completed on 29 September for a $17.5 million (including earn out) and the second was financial software platform MON-E for $15 million. Both acquisitions were funded through a combination of cash and shares (scrip).

Cash Converters acquired 80% of vehicle financing company Green Light Auto in September 2013 through the conversion of a $4 million loan previously provided to the business. In November 2014, Cash Converters acquired the remaining 20% of Green Light Auto, becoming a wholly-owned subsidiary. Cash Converters ceased this lending operation in June 2024.

In November 2009, EZCorp purchased a 30% stake in Cash Converters, appointing two representatives to the board of directors. Between dividend reinvestments and a rights issue in 2018, EZCorp increased its ownership to 36% on 30 June 2021.

Cash Converters made significant acquisitions in 2022. The company purchased the remaining stake in its New Zealand operations for $13.798 million, which includes 11 corporate stores and rights to franchise fees from 11 additional stores, making it a fully-owned subsidiary.

Cash Converters purchased the UK's largest franchise store network, Capital Cash, for $26.5 million in 2023.

Products and services

Cash Converters store in Ellenbrook, WA

The personal finance business is the largest contributor to Cash Converters total earnings, representing 70% of the company’s EBITDA for the financial year 2024.

The personal finance service provided by Cash Converters is made of small amount credit contracts (SACC) up to $2,000 and medium amount credit contracts (MACC) up to $5,000. Both these products are regulated by the National Consumer Credit Act 2009 (NCCP Act) and are available throughout the store network and online to Australian customers. Cash Converters launched two additional financial products, PayAdvance in 2022 and Line of Credit in 2024.

The second-highest earnings contributor for Cash Converters is its corporate-owned store network, which generates income through the sale of second-hand goods, unsecured loans and secured pawnbroking loans. Cash Converters’ franchise network as 30 June 2024, represents 532 stores throughout the globe, including 74 in Australia, and income is generated through royalties paid to the group by the franchisees.

The company also facilitates online retail transactions through its e-commerce platform, named Webshop, and offers customers financial management via the My Loans app. In 2016, the ‘What’s it Worth Online’ tool was launched, allowing customers to get quotes for their items online.

Their stores are a major player in the circular economy, repurposing 1.7 million pre-owned goods in FY2024 in Australia alone.

Cash Converters opened a luxury-focused retail store in Bondi Junction in August 2024, and with more store openings planned in the future.

Secured vehicle financing was provided through GLA – a wholly-owned subsidiary – via a network of Australian finance brokers and car dealers. This business unit contributed 16% of Cash Converters EBITDA in financial year 2021. Origination ceased in June 2024.

Lawsuits and infringements

Two class actions have been launched in the Federal Court of Australia on allegations that Cash Converters charged excessive fees on short-term loans in New South Wales between July 2010 and June 2013. Over 50,000 customers have joined to seek about $40 million in compensation. A $23 million in-principle settlement was reached with more than 37,000 Cash Converters customers in June 2015.

In 2016, an Australian Securities & Investments Commission (ASIC) investigation found that Cash Converters had failed to make reasonable inquiries into the income and expenses of customers availing their small amount loan product. They were ordered to pay back $10.8 million to consumers and fined a further $1.35 million in addition to entering an Enforceable Undertaking (EU) to uplift its risk, compliance and loan application assessment processes. Cash Converters completed all commitments made to ASIC as part of the EU in February 2018 which included the engagement of Deloitte as an independent expert to review the Company’s updated practices.

The investigation was part of a wider focus by ASIC on pay day lending in 2016, with lenders Nimble and Fair Go Finance also refunding customers as a result of investigations.

In May 2018, Cash Converters reached a settlement with ASIC relating to debt collections practices between 2013 and March 2016 resulting in a payment of $650,000 to the National Debt Helpline and the outsourcing of debt collection activity to a third-party, Collections House Limited, which was completed by 30 June 2018. In 2021, Cash Converters recommenced its own debt collection activity after receiving ASIC approval.

Cash Converters made the final class-action settlement payment relating to historic lending practices in September 2020.