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The Raiz (ASX: RZI) share price is surging 9% higher today

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The Raiz Invest Ltd (ASX: RZI) share price is flying more than 9% higher today, following a positive trading update from the company.

At the time of writing the Raiz share price is trading for $1.75. More than 8% higher for the day, after hitting an intra-day high of $1.76 earlier.

What did Raiz announce?

Earlier this morning, Raiz provided the market with an update on its performance for March 2021.

In the update, Raiz provided an insight on the company’s Australia, Indonesian and Malaysian operations for the month.

Raiz noted that global active customers increased 3.5% for the month to a total of 419,552 active users. The company’s management highlighted that active customer numbers grew despite an increase in monthly maintenance fees. Raiz attributed the strength of the company’s brand and value-add operations to customer loyalty.

In addition, Raiz highlighted that funds under management (FUM) in Australia increased 4.4% for the month to $694.27 million. The company noted that net inflows did not slow despite challenging market conditions and fee structure changes.

Raiz also noted that $1 billion in FUM by the end of 2021 remains a realistic target. The company recently achieved $700 million on the 1st of April. Raiz also highlighted that Indonesian and Malaysian operations are exceeding expectations.

More on the share price

Raiz is a fintech company that operates a mobile-focused, micro-investing platform in Australia, Indonesia and Malaysia. The company’s platform enables users to micro-invest the remaining round-up of everyday purchases in exchange-traded funds (ETF). In addition, Raiz allows users to open a superannuation fund.

Depending on the user’s risk tolerance, the company’s mobile financial platform offers a range of different funds. Each fund allocates across a wide variety of financial products including Australian and international shares, fixed-interest investments and cash.

Raiz charges a flat monthly investment fee for each user which comprises more than 60% of the company’s revenue. Raiz recently increased its monthly maintenance fee from $2.50 to $3.50.

As a result, FUM and active customers are key metrics to the company’s ability to generate recurring revenue.

The Raiz share price has surged more than 86% since the start of 2021. Shares in the company more than doubled earlier in the year after hitting all-time highs of $2.20 in February.

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Motley Fool contributor Nikhil Gangaram has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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