Bondora operates in mature markets where there are high levels of competition among consumer lending companies. Its principal competitors include other online lenders, consumer loan companies such as retail chains, and financial institutions such as banks. Many banks and financial companies, as well as consumer lenders that do not currently offer products or services directed at Bondora’s traditional customer base, could begin doing so; new online lending companies could also enter the markets in which it operates.
Competitors may operate, or begin to operate, with business models that downplay legal and regulatory compliance, which has always been a high priority for Bondora Group. This could put Bondora Group at a competitive disadvantage. Additionally, negative perceptions about companies operating with weak compliance models could spur legislators or regulators to pursue additional industry restrictions that may disadvantage the Bondora Group business model. If new platforms or lending models gain acceptance among consumers and investors or face less onerous regulatory restrictions, Bondora Group may be unable to replicate their strategies or otherwise compete with them effectively, which could cause demand for its products to decline substantially. There is a risk that Bondora Group will not be able to compete successfully against any or all current or future competitors. As a result, Bondora Group could lose market share and see revenues decline, thereby affecting its ability to generate sufficient cash flow to fund its operations.
Significant increases in the number and size of competitors for Bondora Group’s business could result in reduced demand for its online loan products, leading to lower revenues. Increased competition or aggressive marketing and pricing practices by competitors could cause Bondora Group’s revenues, margins and turnover rates to decline, which may have a material adverse effect on its business, financial condition, operational results or prospects, or cash flow.
Bondora’s competitive advantages in competitive markets where it operates are its attractive pricing and positive user experience, which is not easy for rivals to overcome.