Peppermint will use a $5m capital raise to support capital requirements for the final stage of its Electronic Money Issuer application in the Philippines.

Fintech company Peppermint Innovation (ASX:PIL) has closed a fresh capital raise achieving its target of $5m with funds to be used to progress its Electronic Money Issuer (EMI) licence application and commercial roll-out of bizmoPay loan service.

The placement to sophisticated and professional investors was at 2 cents per share with an attaching option exercisable at 3 cents on or before June 30, 2023, for every three shares held.

PIL intends to conduct a bonus issue of options to all Australian and New Zealand registered shareholders enabling them to acquire shares at 2 cents per share, for which details are yet to be provided.

Under the capital raise it is proposed PIL will issue one option for every 10 shares held at the record date December 1st , exercisable at 2 cents per share.

Upon exercising these options, shareholders will receive a further option exercisable at 3 cents per share expiring on 30 June 2023, to be listed on the ASX.

Subscribers to the placement in approved jurisdictions will be eligible for the bonus option issue.

Clee Capital has acted as lead manager for the placement and will be paid 2% of gross proceeds as a management fee, 4% of gross proceeds as a capital raising fee and 30 million options exercisable at 3 cents per share expiring on June 30, 2023, to be listed on the ASX.


Raise delivers key criteria to finalise EMI licence

PIL’s managing director and CEO Chris Kain said enormous support had been shown for the company’s latest capital raise from both existing shareholders and new investors.

“We deliberately chose to extend the settlement date due to additional significant demand received from institutional and sophisticated investors wanting to participate in this capital raise,” Kain said.

Funds from the placement will be used to satisfy the Philippines Securities and Exchange Commission (SEC) stipulated paid-up capital requirements of Php 100m (~A$3m), a key criteria of PIL’s final stage EMI licence application.

“The  timing of this placement has worked out very well for the company as last week Peppermint received the official notice of eligibility to proceed to Stage 3 (the final stage) of our Electronic Money Issuer application from the Central Bank of the Philippines (BSP),” he said.

“What this means is our request to the BSP, lodged via the Stage 2 EMI application process, to issue a ‘Letter of No Objection’ to register with the Securities and Exchange Commission for authority to operate as an electronic money issuer has now been granted.”

Kain said with an EMI licence in place any Filipino will be able to use the bizmoto platform to receive digital money and access digital services.

“We are also advancing our commercial rollout of our bizmoPay micro-enterprise loans offering with a target of issuing 1,000 loans to our bizmoto agents over a three-month period,” he said.


Marketing campaign to raise profile of bizmoPay

The commercial rollout of PIL’s micro-enterprise loan platform, bizmoPay commenced earlier this month.  The rollout followed regulatory licence approval in July, and successful completion of a three-month pilot program designed to test the platform, and ensure a seamless integration of its bizmoPay program with the bizmoto mobile app.

The pilot program resulted in the drawing in of ~360 loans across the three different types of loans – Platinum Plus, Platinum and Silver.

PIL now plans to launch a comprehensive marketing campaign over the next three months to promote bizmoPay, targeting its 56,000 plus registered bizmoto agents.


PIL advances foothold in Philippine’s digital finance landscape

In October, PIL signed a significant cash-in, fund transfers and payments deal with Dragonpay — one of the largest and most reliable online payment gateway platforms in the Philippines.

The deal provides a one-stop payment gateway connecting PIL’s expanding bizmoto network to numerous online and over the counter cash-in and payment channels throughout the Philippines.

The bizmoto service will become a merchant within the Dragonpay platform, fat-tracking the platform’s connection to major commercial banks such as BDO, Metrobank, UCPB, Landbank, Bank of the Philippines,  RCBC,  Eastwest,  AUB, Chinabank and Robinsons Bank.

Furthermore, the Dragonpay deal connects bizmoto to the established e-wallets of Paymaya, GrabPay, GCash, and CASHU.

Valuations recently assigned to EMI licenced Fintech  companies in the Philippines have recently skyrocketed.

CoinsPh, an EMI Licensed Fintech, in early 2019 sold a majority stake of its business to Go Jek for $US72 million (circa $AUD100 million).

Mynt the EMI Licensed Fintech behind the GCash Platform, raised US$300 million, valuing the company at US$2 billion.

This article was developed in collaboration with Peppermint, a Stockhead advertiser at the time of publishing.

This article does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.