Bloom Finance today announced the closing of a $7 million Series A financing round led by SixThirty Ventures.
The Canadian fintech startup looks to simplify the process of accessing home equity through a reverse mortgage, enhancing Canadians’ financial flexibility in retirement.
Bloom’s unique financial product enables 55+ year-old Canadian homeowners to access up to 55% of their home value in tax-free funds. No regular principal or interest payments are required, with interest simply accruing over time, and the balance only payable when a borrower moves out, sells their home, or passes away.
The company has been growing rapidly since its launch in late 2021, extending nearly $100 million to homeowners in Ontario and British Columbia to date.
“Four out of five Canadian seniors live with financial insecurity, with income and savings that aren’t sufficient to maintain their pre-retirement living standard”, said Ben McCabe, CEO of Bloom.
“At the same time, the magnitude of home price growth over the past few decades means there is often more than enough household wealth to sustain a comfortable retirement, for most retiring homeowners.”
Bloom has been gaining market share in the traditionally bank-dominated reverse mortgage industry, propelled by its intense focus on leveraging technology to offer the simplest and most transparent equity access solutions for clients, their mortgage brokers and financial advisors.
The fintech believes that equity release will become an increasingly mainstream part of retirement planning, and that unlocking equity in a sustainable way will be the key to greater adoption.
Bloom will use the new funding to accelerate its investments in product and process innovation, and continue its geographic expansion.
“The traditional reverse mortgage is a powerful solution for a broad cross section of homeowners, in a wide variety of financial circumstances”, added McCabe. “However, it’s not the last word on equity release. We plan to continue widening the definition of who equity release is for, and how it can be responsibly delivered.”