QuickFee Limited (QFE) Earnings Call Transcript & Summary

I think we'll make a start here. So good morning, everyone, again. Apologies for the delay. Just had some technical issues, but hoping that Bruce and Simon might show up on camera, I'm not seeing them at the moment. But obviously delighted to have QuickFee management present today. The quarterly business update went out yesterday. It included a bit of a strategy upgrade in some new metrics. So delighted to have Founder and CEO, Bruce Coombes, with us today, CFO, Simon Yeandle; and Eric Lookhoff, who's the President of the U.S. operation. So just a reminder, the guys will walk through a presentation. Simon is going to share his screen. And then we'll open up the line for some Q&A. [Operator Instructions]. So over to you, Bruce.

Fantastic. Thank you, Eric. Thank you, everybody, for taking some time to hear me about our last quarter and our last 9 months, and happy to be here sharing a bit about our business. In terms of -- we, might just jump to the third slide, this deck, of course, is on the [ ISS ]. But I want to make a couple of sort of dramatic sort of statements. What is QuickFee? Then I want to move to the who is it that works for QuickFee to make these things happen? And then move to the how we're going to make these things happen? So QuickFee has been on a journey of evolution. We're at a point now where we are -- what we have always been in terms of a loan originator. The way we have expanded who we originate those loans for to now encompass any service business, expanded beyond our traditional place in accounting and law. And as Simon will show a little bit later, we are a significant payment processer in the United States. So the expression merchant acquirer actually describes now the evolution of our business, particularly in the U.S. to be a significant provider of payment gateway services to service businesses. So as a refresher, we'll look at the 3 circles on this next slide. QuickFee guidance. This is where we grew up. This is where we started 12 years ago. This is our product to enable enterprise-grade, accounting and law clients to be paid faster and give their clients 3, 6, 9 or 12-month payment plan for the client payment installments. This is our product, which is backed by the credit quality of the service provider. And this is why we deal mainly with accountants and lawyers on this product. The largest user of this product in Australia is KPMG. When somebody takes a QuickFee payment plan or a QuickFee finance platform, they must pay us back with interest. In the underlying event, they plan to pay back, we have recourse, in our example, to KPMG. We have recourse to the service provider that provides the services in the business. Take that product, and wrap it in the middle circle called PayNow, and you have our payment [indiscernible] plan. People can take a payment plan service, but also it means they can pay in full by credit card or via a check. In the United States, we call [ AHC ] ACH, the movement of money for one bank account to another, we're a merged acquirer's facilitating those payments. We go through how much that business has growing in the last 9 months. And finally, our new QuickFee storage bay. We've heard about this in our December update. You will be aware that this is one of the reasons we did our capital raise. We have a brand-new product that opens up funding options, payment plan options for clients of much smaller service businesses that we would allow to access QuickFee Finance. This evolution enables us to make the statement that we are a merchant acquirer in terms of paying full services and a loan originator in terms of QuickFee finance or QuickFee installments. Depending on the size of the merchant, and the particular need of the client, we have a finance product available for a much broader range than we have ever had before. So I am going to hand it over to Simon and Simon will take you through some of the financial highlights of the third quarter of FY '21 and then we'll hear from Eric, the President of our U.S. business, around the who and the how to how we're executing in the states.

Thank you, Bruce, and good morning, everyone. I'll start with the U.S. In the 9 months to March -- to March 31, 2021, we have 509 active merchants using the QuickFee Finance platform, and that's up from 327 in the same period in FY '20. In that 9-month period to March 31, 2021, 126,000 active customers have used a QuickFee product. And again, that's comparing to 91,000 in the whole of financial year '20. We saw strong growth in our PayNow transaction volumes, and we're using the term PayNow throughout this presentation to describe those painful ACH and credit card volumes, that was up 128% to $152.2 million for the quarter. March was a record month with -- while we processed $67.4 million through our gateway. Year-to-date, our PayNow transactions in the U.S. are up 161% over the same period in financial year '20 to $436.7 million against $167.5 million. And that's continued the strong growth that we'd seen in the previous 2 quarters of this financial year. We expect to see continued steady growth in those volumes. We're increasing our focus on both new merchant sign-ups and existing merchant usage through new sales and account management resources, a lot more staff and vice presidents there. And the launch of our ConnectAR integration tool to key accounting firms by June 30 this year is expected to drive increased volumes of PayNow transactions, certainly in FY '22. Lending in the U.S. continues to be impacted by the U.S. government's COVID stimulus packages, including the Paycheck Protection Program in Joe Biden's recently announced $1.9 trillion to stimulus package. And that's really led to a decline in U.S. lending down 6% to $3.4 million from $3.6 million in the same quarter last financial year. Near state lending is still up 24%, $11.3 million versus $9.1 million in FY '20. And in the quarter, we've continued to hire some senior U.S. talent that Eric will talk a little bit about later, particularly in strategic partnerships and account management. And I'll explain a little bit about those hires a bit later. In Australia, over on Slide 7, and we have 461 active merchants using QuickFee's platform in Australia this financial year, from 9-month through to March 31 again, versus 473 year-to-date in FY '20. That's a small decline. 24,000 active customers this financial year to date against, in the whole 12 months of FY '20, 30,000 active customers. And as we saw in the previous 2 quarters, lending in Australia is still being impacted by government stimulus measures in the quarter to March 31, as that stimulus is being round back, we are starting to see some increase in demand for lending and borrowing. But for the quarter, lending was down 41% to $6.8 million as opposed to $11.6 million in the March quarter FY '20, and that's similar to our H1 '21 results, it was down 41%. March was the strongest lending month this financial year. And that's given us some confidence, particularly around that month and the fact that April started very strongly as well. We do have some confidence that the demand for borrowing is improving. Consumer confidence is high, but business sentiment still remains quite cautious. So we're confident lending in Australia will return to pre-COVID levels. But it's too early to say when that will be. On the installments product Bruce talked about, we've continued to gain traction in both markets. We now have 531 merchants signed up for that product at the end of March, 270 in the U.S. and 161 in Australia. Lending volumes, it's still early days. We are seeing an improvement certainly through March and April in terms of growth in lending volumes on this product. But it's, in fact, still too early to -- for those to make a material difference to our lending numbers, the go-to-market strategies. At the moment, I focused initially on accounting and law firms, but we are looking at other verticals there as well. And the connected product, the e-invoicing and integrating tool that Bruce has spoken about in the past, and we expect that to be launched by June 30 this year. And that will, again, capture higher volumes, both in PayNow and lending across our existing customer base. If we move to Slide 8, in the few charts here and a few metrics that we haven't shown in the past, there's a bit more detail around customers and merchants that we spoke about. So each pair of charts here shows the quarter -- the March quarter against the prior March quarter and then the year-to-date 9 months against the prior year-to-date 9 months. So the first 2 moving left to right are lending numbers for U.S. As we can see, we've seen some significant growth there year-to-date. The 2 pale green charts are our U.S. PayNow. So that's our pay in full ACH and credit card volumes. And you can see for the quarter, we're up 128% and 161% year-to-date. The next 2 slides, that we've spoken a bit about, some of those volumes in terms of customers. But again, the growth rate is 107% for the quarter and 135% for the 9 months. And again, active merchants were up 62%, both for the quarter and year-to-date. So some quite pleasing growth numbers there. What is important to look at is that the growth in the actual PayNow U.S. dollars, the pale green, the slightly higher percentages than for the customers and the merchants. And that shows that there are more customers per merchant and more dollars being written per merchant as we grow and as those cohorts of customers continue to use the product year-on-year. So we'll talk a little bit about -- more about some of that growth as we go through the presentation. And on the far right is just the growth in installments merchants from December at 70 to 370 at the end of March. We've shown the same lending and PayNow volumes for Australia, as we have for the U.S. on Slide 9. And as a reminder, we don't earn revenue from PayNow in Australia because it is an EFT, and that goes through a platform where it's pretty much free to transact. It's important to note, though, that volumes are only slightly down for the quarter and year-to-date versus the same periods in the prior financial year. Similarly, the number of active customers has decreased only 2% for the quarter versus the same quarter last financial year and has increased 4% year-to-date versus year-to-date in FY '20. Active merchant numbers are broadly level with last year, with 461 transacting with us year-to-date versus 473 in the FY '20 year-to-date. And that supports our previous messaging, that we're not losing any material volume of merchants or customers in Australia through COVID, just as the demand for borrowing softened. So the number of merchants and customers are staying broadly level. So the volume of borrowing going through our platforms has decreased. So with that, I'll pass back to Bruce to explain a little bit about how we've been evolving our strategy.

Fantastic. Thank you, Simon. So you can see that data reflects the fact that we have become a significant merchant acquirer, and we have an enormous opportunity to build out more in our chosen markets. We're fortunate enough to have channel partnerships. Using Australia as just one example. You go to our website. We are a lender benefit partner with the Law Society of Victoria, the Law Society of New South Wales, the Law Society of Western Australia with [ indiscernible ]. We have relationships with a number of other professional organizations endorsing our solutions. Channel partnerships are an important part to market in both U.S. and Australia. We are leveraging the modernization that is happening in the United States. The vast majority of accounting firms that we have onboarded in the U.S. have not had an epayment solution at all. 75% to 85% of the invoices being issued by these firms are being issued in paper, so it's not as prevalent to see epayments in the invoicing in the U.S. market as it is here in Australia. That is our opportunity. Fee payments, leveraging the invoicing and enjoying the tailwinds that come from modernization in our chosen markets. So we need to have the right people to do that. So I'm going to transfer you over to Eric, who joins us from the United States, to share a little bit from his own experience and that of the team that he has put together to help us execute with precision in the States.

Thanks, Bruce. Good morning, everyone. Greetings from the U.S., Texas. Happy to be on board with QuickFee. Joined at the beginning of February. My background in payments here in the U.S. and the last 25 years, I've been leading scale-up and hyper growth organizations in the payment space from checks to ACH, credits and debits, transactions, online and mobile transactions and fintech lending. And done that across all the parties to the U.S. payment space, from acquirers, processors, issuers, networks and loan originators. And through some rather large brands with First Data, with Intuit, Discover Financial Services, AIG, and a handful of other hypergrowth payment businesses that have been sold and exited within those organizations. And start-up stages to growth to hyper growth to more stable portfolio sized U.S. payment businesses as well. When you think of how we're adapting the original Australia story into the U.S. marketplace, it really all begins and ends with the people and the products, and that's the team that we've put together that you see here on the slide. This is really all around our core go-to-market strategy around merchant direct, around enterprise and national accounts, press and channels and strategic partnerships that Bruce mentioned and I'll speak on more in a few slides. The team here, Jay Alsup -- I'll just go quickly to the group. Jay Alsup also is a recent addition here in the last 60 days. He is in charge of our -- all of our demand-generation architectures that we're creating to really drive scale in customer acquisition and brand management here in the U.S. across the finance, the P&L product suite as well as the new installment product suite. Rich Formoe, our Chief Commercial Officer, is driving our enterprise national account group, which houses in addition to the large enterprise CPA space that we have all a history with, the large national brands that continue to validate product in the U.S. market space as well as our ISO channels that are boarding on as well. Carlos Whiteman joined us here in the last several weeks. Carlos is SVP of strategic channel partnership. He is driving and responsible for all of the ISVs, the value-added resellers, the channel partnerships associations alliances as well as really driving our integration strategies that bring and integrate our payment gateway into the practice management solutions and into the enterprise resource planning solutions of our merchant base. Carlos joins us from 16 years with American Express, JPMorgan Chase, MasterCard, and was most recently head of strategic channel partnerships for Comdata, which is the largest commercial card issuer of MasterCard in the United States. Sue Torgerson is leading our product team from a market-facing standpoint, particularly comes with depth with Wolters Kluwer, one of the larger accounting services businesses here in the U.S. market. And to that, we've added Tony Yousef and Valerie Baillairge in the Australia team to round out provisional sales and marketing efforts there. James Drummond is our Chief Operating Officer, really brought the business to the U.S. in 2016 with a deep accounting background there as well. So that's the team that we've assembled. Please move to the next slide here. And then that is to drive penetration and adoption within our 4 core payment products. So if you think of the finance, the PayNow installments and the integration-heavy ConnectAR product, that's all around our go-to-market strategy, and that’s 3 avenues that we'll be marching down. One is developing our merger direct platform, which lowers our cost of acquisition. It allows us to go beyond the traditional top 400 CPA enterprise market space to the smaller firms, where we can get to them through the demand generation channels that we're developing. That along the way is launching our online merchant application experience, automated onboarding, automated underwriting platform, which launches here at the end of June, allows us to expand market for the product, particularly for the QuickFee installment product. As well as the enterprise national account pieces that I mentioned in the channel in ISP. One note I'll mention here on the shifting that you saw moment ago with the growth numbers for U.S. for PayNow, that is a shift that's happening from cards towards ACH, which has an expanded margin for us. So we're happy to see, within that 161% year-over-year growth number, there is higher growth within that within ACH, which carries a higher margin. And then the installment product that I'll just call one, one differentiation there in terms of how we're applying installments to our merchant set, particularly the service businesses, how that varies from more traditional online retailing buy-now, pay-later products, which are really aimed at the customer who is buying something largely that is discretionary with money that they don't have, there is credit issuance happening in that traditional buy-now, pay-later space with the QuickFee installments product that's really targeted to a customer who is really more selective in how they want to spend the money they already have. So they're purchasing products that they need with available credit that they have in terms of how the installment product works today, which, in effect, allows us to generate a 10x average ticket size than what you'd see in traditional retail, online buy-now, pay-later products. Underpinning that is a heavy focus on integration across all of our products and across the verticals that we are expert in and beyond.

Fantastic. Thank you, Eric. So I want to share things around the organic growth that already sits inside the merchants we already have. So the chart on the right-hand side shows the multiplying of volumes based on each cohort of merchants when they sign up? So when does somebody join us? And how much will they grow each year? So I use financial '19, as an example. The bottom left corner of the chart on the right-hand side of the slide tells you what is, a, that's your starting point. If a merchant did $100,000 with us in financial '19, as you [indiscernible] the line, in financial '20, that same merchant, no additional merchants, did $330,000 with us, 3.3x. And a year later, in financial '21, their annualized rate right now after 9 months to March 31, saw them doing $500,000 compared to the $100,000 they did with us in the first financial year with us. So there is an underlying growth in merchant usage of our payment platform. You can see in the chart on the left, to the right shows you the multiplied effect as people in terms of their clients modernize and also as the firms himself embrace the epayments solution wherever buying. There are 18 billion checks being written in the United States every year. That's going down about 10% a year. This is what we are capturing in our chosen service businesses. Typically, these products have only been made available to firms with businesses with a revenue above $1 million. So we now forward to the next slide there, where you can see how many more merchants in just accounting and law, the group that [ indiscernible ] gives us access to. For those who don't know, the way this product is structured, what makes it responsible spending, as Eric mentioned, is that we have licensed to share with ASX SPT, their technology to use in our shows and ROES. So what's happening here is when a merchant offers a client a payment plan using the QuickFee installment solution, that client is getting 4 months' interest free at the first payment; the next month, another time; the month after that, another payment; the month after that, their final payment. 4 months interest free. We secure the unpaid balance of the payment plan against an unused element of a credit card already held by the customer. Today, they are talking about the, I think, the first pay day for [indiscernible] [ Latitude ] made some changes that are likely in traditional BNPL. As Eric said, traditionally, buy-now, pay-later involves the issuing of new credit probably to people for something that they wanted. QuickFee installments involves no new credit. It is leveraging the credit the client has already earned with their bank through their unused credit card balance, no late fees, no interest to the consumer, no new credit, 4 equal monthly interest-free installments, and we charge the merchant 4.99% to make that service available to their clients. Our traditional markets of accounting, of course, [indiscernible] shared with you. Accountants are the #1 trusted adviser to small and medium business owners in Australia and the United States. We have deep relationships with them. So not only do we understand their business, we understand the importance of them to small and medium business owners. By having a product in the form of QuickFee that clients have already used to make payments or take a payment plan to pay their account, will expose them to the QuickFee brand through a QuickFee payment plan solution and can leverage their exposure for their accountant to say, Well, QuickFee installments may be a great thing for your business as well. So I'll hand back to Eric now who'll take you through a bit more than what we've done in the last few months around strengthening our foundation in the United States.

Thank you, Bruce. So here, I'll take you through the core focus here on all the construction that's happened in the last 60, 70 days or so. Starting off with the people, we are embracing the remote work shift that's happened here in the U.S. That's allowing us to compete for some excellent talent, some of whom I mentioned at the top of the call here, from a senior leadership standpoint. But even sort of a layer down from an operational execution standpoint, we've been able to attract some core talent from some very competitive providers in the space simply because we're allowed to leverage to work remote. So talent for its location second is the path that we chose follow and as well as a nice effect in terms of moving away from commercial cost of real estate as we get larger. On the product side, we're continuing to focus on features and functionality in terms of recurring payments. It's something that we are launching here in the next quarter or 2, which will be both for our ACH product and our card product, and that continues to help reinvent the merchant base that we have and continue to see lift of transactions growing faster than merchants certainly than clients and clients growing faster than merchants. So we'll continue to see lift in leverage on those activities with a number of the product features and capabilities we're rolling out as well on our finance product as we expand from one particular set of the largest enterprise peer markets in the country to the next layer down and opens up more of that available addressable market space, and Simon will talk about that here, and Simon too as well. On the marketing side, I mentioned the demand generation architectures and quite a bit of construction work happening there to move from a more human-driven acquisition model to a much more precision marketing, online advertising in drawing much more traffic to our automated merchant application experience, automated underwriting and onboarding platform that launched this year at the end of June. On the operations side, replacing many annual processes and document-heavy processes here in the U.S. as the business was first born here several years ago, and replacing that with much more seamless and scalable experiences. And then on the technology side, there's 2 pieces to this. The first is making sure that as we continue to evolve technologically, that we really own our transaction and own our own platform and proprietary systems there. So quite a bit of migration that is happening across all our product suites and owning the acquisition of the transaction. Boosting up our securities and compliance policies and procedures there as well as certifications for [ stock type ] 2 type 1 and 2, which will happen this calendar year and ISO 27,000 certification, which kicks off here in the second quarter of FY '22. And then the other is really building out our economic model from a platform processing standpoint and moving us along the money transmitter and payback journey that allows us to taking larger margin of the card activity and larger margin of the ACH activity as that continues to grow and develop. And there's a clear road map, as we've mentioned here across all the payment expertise, this really combines the talent that we've put together, the experience that we've put together are taking advantage of the first mover status that we have here in the U.S., particularly around the enterprise CPA market and the legal market from a payments perspective. And really developing out a robust risk management capability, not just at the merchant underwriting stage, as Bruce mentioned earlier around recourse and some of the really low-risk features from a lending standpoint, but adding to that merchant transactional risk management capability as well.

Thank you, Eric. Conscious of time, we have got a few slides of historic information, mainly financial more of an appendix at the back of here. We'll just touch on the first one, which talks a little bit about the U.S. market. And on the right-hand side, the huge opportunity we have just in the accounting space in the U.S. So the entire market in terms of revenue in the U.S. is $118 billion. QuickFee currently, through our payment gateway, is processing a run rate of about $0.8 billion of that, which is the far right piece of that Blue prime, a small one. Just in terms of QuickFee's complete portfolio, the customers we currently transact with, that portfolio is $6.1 billion. So there's $5.3 billion of revenue that doesn't go through a QuickFee platform currently, just to the firms we deal with. And that $6.1 billion in total is a small portion of the entire market of $118 billion. Out of that $118 billion, half of it is roughly the big 4. So about those is still, we estimate, probably about another $32 billion that's in our wheelhouse with the products we currently have that would suit the size of accounting firms all there. So just in accounting, just in the U.S., the opportunity for us to grow both lending, installments and our PayNow our product is enormous. I don't know if we have time for anything else, but I'll pass back to Bruce to wrap up.

Okay. So, Eric, more than happy to take any questions, if there are some and...

[Operator Instructions] There are a couple that have come in. Maybe just one quick one for me to get things done. And, Simon, so you didn't get a chance to talk to Slide 23 on the margin expansion opportunities. Obviously, QuickFee, as you know, is focusing very much on the top line. But maybe you could just talk a little bit to this slide, which, I guess, talks to the scalability of the QuickFee model.

Certainly, I think the important thing here is with these are historic numbers for FY '19, '20 and the half year to December '20, but the net transaction margin level, which is all our income less interest, cost of sales and impairment of receivables, which remains very low number given our low-risk model, our net transaction margin to revenue is tracking upwards of 71%. The investment we're making in automation, particularly onboarding merchants and nurturing those merchants through the installed product are going to keep our fixed costs much lower. So we do get that fixed cost leverage. In terms of our total transaction volumes against total employment costs at the bottom. That is a reasonably healthy number when you look at some of our ASX BNPL peers. We are not a BNPL company as such. We are a payments lending company with a BNPL product being installments. But it does show that the amount we're continuing to invest in our own product and in automation and digital marketing and lead generation is going to expand our margins.

Great. Thanks, Simon. So a question here from [ Richard Choe ]. Just asking about how much competition does QuickFee face from the Zeros and MYOBs of the world in regards to the finance products that they provide?

Yes. It's a good observation. You're probably aware that MYOB recently announced an investment that they've made [indiscernible] with [ UTN ], which is a very different product to QuickFee. That's very much an accounts payable lending-style product. Clearly, Zero and MYOB want to position themselves somewhere in the flow of [ loans ], wherever they can. So an opportunity for us, as Eric said, is around our integrations, around working more closely with these buyers. You may have seen that MYOB has passed the final hurdle in its acquisition of a cloud product used by accounting firms in Australia called GreatSoft. We've already integrated fully with GreatSoft that allow for payments and the receiving back of those patents inside what is now MYOB's cloud accounting solution for enterprise-grade accounting firms.

Thanks, Bruce. Now this question comes through from Richard, actually just a clarification question on Slide 8. Could you explain how the U.S. active merchant numbers differ from Q3 to the year-to-date figures? And what does the 509 year-to-date number actually represent?

Yes. That represents any merchant who has transacted with QuickFee in that 9-month period. So the 509 would be the total number of merchants transacting with us, unique merchants, in that 9-month period. In March, we had 496 unique merchants transacting with us. So that would be across any product, whereby we are settling to that merchant either from an invoice that's either been a payment plan being taken out or it's pay in full from the client or one of the installment merchants.

Thanks, Simon. Questions come through from Kenny Tam, just about the competitive environment. He's asking in particular, what do you think is bill.com? Are they a competitor or a potential partner? So I'm not sure if you guys have a view on that. But maybe just more broadly, as you respond to that, if you could maybe talk a little bit more about the competitive landscape. Obviously, lots of buy-now, pay-later companies coming to the market. Now I guess what is the real point of difference for QuickFee, I guess, and what's to stop one of these larger buy-now, pay-later players coming into QuickFee's space?

Yes, absolutely. So in the U.S., build.com is a well-established sort of payments platform. Its specific purpose is to enable easy payments between small and medium businesses. We are different in as much as you don't need a bill.com account to use us. You can use invoices from any service provider if it's QuickFee installments by QR code; if it's any of our other products, [indiscernible] in without opening account, without doing any such thing and go and pay. When it comes to buy-now, pay-later comparison, it's very similar with Zip, with Afterpay, with [indiscernible], you have to open an account. You've got to apply for credit. In the United States, [indiscernible], a firm, [indiscernible], which is big in the States, you must open an account. You must apply for credit. With QuickFee installments, there is no credit application whatsoever. There is no new credit whatsoever. So there's an important differentiation there. We see the buyer [indiscernible] for QuickFee installments as a little bit of an older group, the early green shoots we're sitting on this product are, as Eric said, a $3,000 average transaction value. Typically a little bit older in terms of the buyer, more likely to be somebody buying that they need than something they want and likely to be a homeowner or an older demographic or both. Quite different to where somebody with $150 or $300 ticket size is sort of playing.

Thanks, Bruce. Maybe just on QuickFee installments to continue on from that. Just around sort of how you grow scale in that business. And maybe we're going to get Eric to talk to the unexpected that question?

Eric can take you through the merchant-direct model and what we're doing there.

So the merchant-direct model is to replace the live sales team that would be necessary to go below the top 400 enterprise CPA market in the U.S. And so developing that out is the automated online merchant application experience, the automated underwriting, the AML/KYC program that we need from a risk-management standpoint to meet the terms of our sponsor bank processing relationships as well as the automated onboarding activation on the platforms between ourselves, the suited technology and our gateway providers for both QuickFee installments, card and ACH. So that is the merging direct model that's being developed out now. At the beginning of that is the demand generation architectures that are driving those merchants to that experience, to those landing pages and from those landing pages to the merchant direct online experience as well.

Okay. We've got a question that's come through from Adam Upton. Maybe it's one for Simon, if not Bruce. Can you please give us a view on how we should think about growth of the different revenue lines? So interest revenue versus noninterest revenue in both Australia and the U.S.?

I think in terms of our interest revenue is directly linked really to the traditional lending product. There is some interest revenue out of the installments products as well. But I think that comes down to looking at lending volumes. It's really too early to think about when -- exactly when lending will return to pre-COVID levels. We're pretty certain it will in Australia, in the U.S., we're just starting to see a little bit of easing of demand with all that stimulus in the economy. But the markets in both countries that we operate in are huge. We've got investments in sales -- new sales staff, account management, so we're pretty confident we can drive increased usage through our existing customer base with the integration tools, ConnectAR and others that we've talked about. But it's too early to sort of really predict when those lending numbers will return to those pre-COVID levels because it's just too uncertain to know what's happening in the economy. There's high -- in Australia there is high consumer confidence, unemployment is really low. So you think the economy was is firing on all cylinders, but there is still a level of caution and business sentiment is still very much in that sort of cautious space at the moment. So we're not seeing a huge kind of an uptick in demand at the moment. We are seeing the green shoots of that. March was very strong. And April is starting very promisingly, but it's quite hard to predict where that would be. In terms of the P&L growth, that revenue doesn't feature in the interest line. It features in some revenue from contracts with customers. We'd expect to see certainly similar growth through to that we've seen year-to-date through to the full year to June '21. And again, it's a vast market with Eric and the team that we've got in the U.S. at the moment, it's quite possible we could see that going up in multiples rather than just sort of 1.5x, 2.5x. So over the next 2 to 3 years, the opportunity there is extremely exciting.

Thanks, Simon. So I've got 5, maybe a couple of more questions. One comes through on ConnectAR, and just sort of broadly how it works and how it -- hopefully, we'll have to push more volume through the QuickFee platform.

Yes. So that's the whole purpose behind that product. It's about moving the payment experience to a less-friction experience by delivering the invoice electronically and, therefore, enabling easy transfer of payment with full transfer of the client data through the payment gateway, so there is less friction when somebody goes to pay. Pulling out your checkbook and writing out a check, that is friction. It is encouraged when we mail you an invoice, it means payment. If we can stop sending invoices as a opposed to [indiscernible] it gives you something to click inside your inbox and then pre-fill where you clicked, you are much more inclined to do your payments online, which is what will grow these revenue streams, which are on this slide in front of you right now. ConnectAR is an integration tool to move more of our merchants' volume to us.

All right. Thanks, Bruce. There's a question here around when QuickFee might list their shares in the U.S. I would have thought given Afterpay going at doing that at $35 billion market cap that it's probably not on the horizon just yet for QuickFee. Maybe just one -- maybe one going to Simon just to cover around the capital position. Cash at bank, how the company is funded to fund the growth that they've been to help grow over this coming period. And maybe go over just quickly, any change in the level of bad debt?

Yes. No bad debts remain very low. We haven't had any in the quarter. And our loan book, particularly in Australia, will decline to June. So it's important we don't -- that no one is surprised by that. And that's really because of the 12-month term of most of our loans; the average is around 10 to 11 months. But July last year saw the sort of first month where the decline in volume really bit. So that will take to June for the loan, but to sort of go down before it starts coming up again. So in terms of cash, we have $30 million at December 31, we use it to actually pay off the challenger loan on the -- which supports the AU facility at the moment, receivables. So it's probably in a similar position to the December numbers in terms of our cash versus borrowings. We're -- currently, our cash burn is around about the $600,000, $700,000, $800,000 a month. We'd expect that to peak probably middle of this year and around the $900,000 to $1 million a month and then it should start to decrease over the next 18 months as we're starting to earn more interest, more ACH revenues. And we'd be looking to, at some point in the next few years, certainly start turning profitable and being cash positive. So we don't believe, based on the amount of cash burn at the moment, that we'll need to go back to the market anytime soon to fund our operations. If our loan book grows significantly, multiples that it could do, we may be looking at increased borrowing facilities and potentially more capital raising, but it would only be to fund the loan book. It wouldn't be for operations.

Thanks, Ian. So don't have any other questions registered. So maybe then just one last one, to finish up just maybe to talk through, I guess, key priorities this next final quarter of FY '21 and then beyond that? So over to you, Bruce.

Yes. Our key priorities over the next 3 months is to get ConnectAR out the door in a simple MVP form with basic integration into the invoicing systems to the leverage channel partnerships that we have already put in place to have people like Carlos working on to grow this -- the data -- you see on the slide here -- to grow these revenue lines. Grow our footprint or revenue, so finally, leverage the reputation and status that we have with our accounting footprint in the United States to grow it even more.

Great. Well, Bruce, Simon, and Eric, thank you very much for taking the time to present today and to everyone that's dialed in. I appreciate the time. If you have any follow-up questions, feel free to reach out to Simon or myself, and we look forward to your continued support. So, Bruce, I'll return back to you to wrap things up.

Thanks, everybody. I really appreciate everybody taking the time to be on this call. And of course, appreciate you being a shareholder in QuickFee. Thank you very much.