Are you interested in investing in the early childhood education and care sector?

By Jason Roberts

The article is also available at https://thesector.com.au/2023/05/02/are-you-interested-in-investing-in-the-early-childhood-education-and-care-sector/

The growth of the early childhood education and care (ECEC) sector over the last ten years, particularly in the long day care (LDC) segment, has been consistently strong, reflecting the increasing demand for early learning services from families right across Australia. 

As we approach July 2023 a new series of affordability measures, passed by the Federal Government as part of its Cheaper Childcare Bill, will come into effect providing fee relief for a significant portion of Australian parents.

Against this backdrop more and more people, both inside and outside of the ECEC sector, are beginning to recognise that the early learning sector is here to stay and are seeking opportunities to complement their existing savings plans with an investment in the early learning space that enables them to participate in the expected growth of the sector in years to come. 

“Over the course of the last several months we have seen a substantial increase in enquiries about savings products that are linked to the ECEC sector,” Neil Sheather, Managing Director of Finexia said. 

“As an ASX listed financial services company with a long track record in delivering innovative savings solutions to the Australian public we are excited to be able to direct people to our latest product which aims to do just that for the early learning sector.”

The Finexia Childcare Income Fund - An investment fund focussed on ECEC

The Finexia Childcare Income Fund is an important new product recently launched by the team at Finexia that is now open to investors, and which offers a 9.50 per cent per annum return, around 5.65 per cent higher than the RBA’s current cash rate. 

“Investing in the Finexia Childcare Income Fund provides investors with the opportunity to gain exposure to the high growth Australian Childcare sector,” Mr Sheather said.

“By partnering with highly experienced and successful approved providers who are delivering  their own greenfield strategies and opening and trading up new centres, we are not only supporting the ongoing provision of services across Australia but providing solid returns for our investors too.”

Finexia’s position as a credible financial services provider allows them to step into a funding gap that many major banks have largely abandoned and provide short term loans to experienced providers who are developing centres on commercial terms with appropriate security and collateral. 

With loan terms generally for the “trade up” period and structured between 12 to 24 months, Finexia is able to capture a return for investors keen to build exposure to the early learning sector.

Initial investment start at $5,000 with regular monthly contributions possible thereafter 

The Finexia Childcare Fund is open for investors of all types with initial commitments starting at $5,000, with a scheme in place that allows for monthly contributions thereafter. 

“We have tried our best to ensure that the fund is open to investors of all sorts and as a result we have lowered the initial investment to $5,000 and have also provided an opportunity for investors to contribute monthly directly into the fund,” Mr Sheather said. 

The reinvestment option means that any income generated from an investment can be received as cash by the investor, or can be reinvested back into the fund itself, creating another savings opportunity. 

“As an ASX listed organisation we take our responsibilities as a financial services provider very seriously,” Mr Sheather said. 

“We are keen to engage with as many early learning professionals as possible who are interested in investing in our income fund and importantly, we are here any time to answer questions from the community.”

“The future looks very exciting for the early learning sector and we look forward to doing our bit where we can.”

To learn more about Finexia and their fund please click here.

*The investment return is fixed at 5.65% above the prevailing RBA cash rate which is currently 3.85% at the time of publication (return of 9.50% pa). All investments carry degrees of risk. This product is not appropriate for everyone. You should obtain a copy of the Product Disclosure Statement (‘PDS’) and Target Market Determination (‘TMD’) relating to the product and consider them before making any decision to invest in the product. These disclosures can be obtained from registering your contact details on https://www.finexia.com.au/childcarefund.html. Forecast returns and distributions are subject to several assumptions that are detailed in the PDS.