Summary
- Fatfish has announced the launch of a BNPL business for corporates via its investee company Smartfunding Pte. Ltd.
- The BNPL financing will allow corporates to apply on Smartfunding's website digitally for a loan amount up to AUD 1.04 Million to be repaid in a period of 12 months to 24 months.
- Smartfunding is licensed by Singapore central bank and has secured a Capital Market Services (CMS) license from the bank for the Dealing in Securities category.
Fatfish Blockchain Limited (ASX:FFG) has announced that its investee company Smartfunding Pte. Ltd will roll out a Buy-Now-Pay-Later (BNPL) business for corporates in the Southeast Asia region. Fatfish holds 58.8% stake in Singapore-incorporated Smartfunding via its Swedish subsidiary Abelco Investment Group AB.
Fatfish has also entered a binding term sheet to secure a direct 19.9% shareholding in Smartfunding on top of the stake held by Abelco. FFG will also offer technical and marketing assistance to Smartfunding to assist the company in launching its BNPL services.
Smartfunding currently provides short- to mid-term working capital loan to Small and Medium Businesses in Singapore and other international markets through a peer-to-peer online lending platform. Its entry into the BNPL is a natural business progression.
Smartfunding is licensed by Singapore central bank. It has received a Capital Market Services (CMS) license from Singapore central bank for the Dealing in Securities category. The license provides Smartfunding numerous regulatory abilities to execute transactions in any investment instruments which are categorised as securities under the Singapore Securities and Futures Act, debt securities included.
Also read: ASIC Reports One in Five BNPL Users Missing Payment of Bills
Transaction details
FFG is immediately taking another 19.9% stake in Smartfunding from existing
non-related shareholder of Smartfunding, Investorlend Singapore Pte. Ltd, at AUD 544,950 through a script. The company will issue 11,594,680 new Fatfish shares at an issue price of AUD 0.047 a share to meet the Purchase Consideration. The issue price is at the 5-days Volume Weighted Average Price of Fatfish, recorded as of the close of business on 20 November 2020.
Mr Shariffudin bin Mohamed Raffi, another remaining shareholder of Smartfunding, has also provided Fatfish a 6-month option to further buy an additional 10.1% stake directly in Smartfunding at AUD 250,000, payable in FFG's ordinary shares based on a deemed price of the five-day VWAP at completion and a minimum floor price of AUD 0.03 per share. If FFG chooses to exercise this option, it is subject to approvals from its shareholders and Singapore central bank MAS.
Smartfunding's BNPL Financing Service
The BNPL financing will let the companies apply on Smartfunding's website via a digital process, and procurement of equipment or services, for an amount of AUD 26,000 up to AUD 1,040,000 to be repaid in parts over 12 months or 24 months period at a competitive interest rate.
The capital for BNPL financing will be offered by third-party investors onboarded on Smartfunding's online lending platform. The investors could be institutional and individual. The BNPL platform frequently onboards investors and provide them with the opportunities to participate in alternative investment instruments.
For instance, if N number of companies seek BNPL financing in a month, Smartfunding will design and launch a series of N number of debt instruments which will all be funded by third-party investors. Each financing case will be presented as a unique debt instrument.
On 25 November 2020, at AEDT 3:11 PM, FFG was trading at AUD 0.050, up by 8.695%.
Also read: Zip, Afterpay welcome ASIC’s BNPL report
