Sprive Raises $7.3M to Simplify Mortgage Overpayments

The Challenge of Early Mortgage Repayment

A significant number of mortgage lenders do not benefit from homeowners accelerating their mortgage repayments. Their revenue model is fundamentally tied to the duration of the loan. Consequently, early repayment is often discouraged, and in some instances, even subject to penalties.

However, a novel solution has emerged, addressing both the technological and financial aspects of this issue. This is the core concept behind the Sprive fintech application.

Introducing Sprive: An Automated Overpayment Platform

Sprive is a mortgage overpayment platform specifically designed for the U.K. market. It leverages automation and cash-back incentives to assist users in reducing their mortgage principal more quickly.

The company asserts that, on average, users can realize savings of approximately £10,000 over the entire term of their mortgage.

Recent Funding and Backers

Launched in October 2021, Sprive has recently secured £5.5 million ($7.3 million) in a funding round. This investment was spearheaded by Ascension, a venture capital firm focused on impact investing.

Ascension’s portfolio also includes Tembo, a mortgage startup, alongside other fintech companies such as Wagestream, SuperFi, DebtStream, Goodstack, and Credit Kudos (acquired by Apple).

How Sprive Facilitates Faster Repayments

The Sprive app functions by enabling homeowners to expedite their mortgage repayments through routine purchases. It automatically allocates surplus funds towards overpayments and continuously monitors the market for more favorable mortgage rates.

Users can contribute to their mortgage by making purchases at prominent U.K. supermarkets through a bank account connected to the Sprive app. Utilizing cash-back offers, discount vouchers, and similar promotions, they can accelerate their mortgage payoff.

This process reduces the total interest paid on the mortgage and potentially shortens the loan term by several years.

Sprive's Value Proposition for Lenders

“Mortgage lenders are actively seeking innovation within the industry, but they heavily rely on mortgage advisors for remortgages,” explains Jinesh Vohra, CEO of Sprive, in an interview with TechCrunch.

“Attracting customers to refinance requires these advisors, who often operate with limited digital infrastructure and are fragmented, making innovation a costly endeavor. We, however, possess access to crucial data including spending habits, mortgage details, credit history, and property information.”

Vohra emphasizes that Sprive provides lenders with a more streamlined, digital method for acquiring new customers.

“Our revenue is generated each time a user shops or refinances their mortgage. Within 15 minutes of a purchase, funds are directed towards the mortgage, and we conduct daily scans for better mortgage deals. We receive commission from the mortgage lender whenever a customer refinances.”

Additional Investors

This funding round also saw participation from Channel 4 Ventures (the investment division of U.K. broadcaster Channel 4), Velocity Capital, and Two Magnolias.