VIDEO solutions provider Artivision Technologies is in discussions to extend the Dec 31, 2018 long stop date on its acquisition of electronic payment and online retail business Mobile Credit Payment Pte Ltd (MC Payment).

The total consideration for the acquisition includes a base consideration of up to S$80 million for the purchase of sale shares held by the shareholders of MC Payment; an additional consideration of up to S$20 million; and an amount of up to S$25 million in respect to the acquisition of iFashion Group, an online fashion venture platform that MC Payment is in the process of acquiring.

The company had said previously that “the proposed acquisition of MC Payment presents an opportunity to acquire a new business, meet the Catalist ruling and enhance value for shareholders”.

Artivision advises shareholders and potential investors to exercise caution in trading their shares as there is no certainty that the proposed acquisition will be completed, and that it will make further announcements when there are material developments.

Singapore homegrown fintech player, MC Payment, has partnered with global Blockchain based platform, NULS to expand into the rest of the ASEAN market.

MC Payment intends to build their own chain on NULS’ protocol, valuable to the payment company for being modular, open-source and most importantly to the firm, features cross-chain capability. The partnership is intended to serve as a foundation to MC Payment’s future blockchain initiatives and partnerships.

In a quid pro quo, MC Payment’s blockchain consultancy arm will also be working with NULS to encourage more blockchain projects into the ecosystem, and become one of the blockchain’s evangelists in developing a future NULS community.

What is NULS, and Why is MC Payment So Keen On Them?
CoinSpeaker has characterised the China-based NULS blockchain as “one to watch“, and has been added to MIIT’s Global Public Blockchain Assessment Index (GPBTAI).With backing by the Chinese government, the blockchain specialises in modular architecture—which would be familiar to those who use WordPress for website construction.

The blockchain is geared towards companies with little to no technical expertise to incorporate blockchain to their business, without having to recruit software engineers.

NULS is about to launch a unique software system, known as Chain Factory, designed to slash the costs and development time for companies who want to develop a chain application of their own.

The Asia-Pacific blockchain market is projected to grow at the highest CAGR (54%) between 2018 to 2023, and potentially worth USD 4.59 billion within that same period. It seems like MC Payment is putting money into that projection, and attempting its hard push for NULS as their own way of riding that wave across ASEAN.

“MC Payment is pleased to partner NULS in this latest expansion in ASEAN markets. With the reputation we have built over the years in this region, finding a partner that can go the extra-mile with us, is vital.

We foresee [that] this collaboration will allow us to build more robust projects on top of NULS’ technology, thus benefiting our existing partners. We target to add blockchain technology into our cashless payment platform within the next five years.”

• Instapay complements Indonesia’s “Ayo UMKM Jualan Online” (Let SMEs Sell Online) campaign to get SMEs across Indonesia to trade products online
• Targets to have 8 million SMEs customers to leverage on MC Payment platform by 2020
• Mobile micro financing and instalments platform for SMEs will be rolled out in the coming months

SINGAPORE/ HONG KONG, CHINA – Media OutReach – 13 September 2018 – MC Payment, a homegrown fintech player, announced the soft launch of Instapay, a B2C payment platform targeting Indonesian Small-Medium Enterprises (“SMEs”) market. Instapay enables merchants and their customers to simplify payment transactions, by using social messaging apps such as Whatsapp and Line to facilitate payments. Approximately 1000 merchants have signed up and utilized the payment services to date.

Instapay is a mobile application that provides businesses with the ability to invoice their customers via social media and accept various payment methods. It can be performed quickly, easily, securely, anytime and anywhere. Instapay can help small business owners expand into international markets and accept international credit cards. It can also accept credit card payments without website integration or EDC machine.

PT MCP Indo Utama (MC Payment’s Indonesia division) Country Director, Mr Valerino Wijaya said “MC Payment has identified pain points associated with payment processes in SMEs. This includes inability to monitor and accept a wide range of payment channels. Instapay provides an easy mobile-based solution that directly solves these problems so businesses can focus on what they do best.“

Many industries look to benefit from the convenience offered by Instapay. The wedding industry for instance has many sole-proprietor businesses such as florists and tailors who will benefit. Similarly, small retailers selling shoes and fashion accessories online as well as small-to-medium hotels and villas in the tourism industry will benefit from the enlarged consumer market size.
This is in tandem with Indonesia’s “Ayo UMKM Jualan Online” (Let SMEs Sell Online) campaign1, which is aimed at attracting and persuading SMEs across Indonesia to sell products via online marketplaces to increase profits and prosperity. Several government bodies that have taken part in the campaign include the Communications and Information Ministry, the Cooperatives and Small and Medium Enterprises Ministry and the Creative Economy Agency (Bekraf). 6 online marketplaces who were involved are; Blibli.com, Tokopedia, Bukalapak, Shopee, Lazada and Blanja.com.

The Indonesian government has set the goal of letting 8 million SMEs go online by 2020. As of 2017, there are a total of 59.26 million SMEs operated in Indonesia. However only 3.97 million SMEs were active online.
MC Payment’s Chief Executive Officer, Mr Anthony Koh, said, “MC Payment is pleased to strengthen our market presence in Indonesia with Instapay. Approximately 1000 Indonesia merchants signing with us, is a testimony of the platform accessibility and stability. Instapay enables small merchants to save time without the hassle of going to a bank. At the same time, these small business owners will be able to manage their cashflows better.”

“MC Payment will be rolling out supporting services like mobile micro financing and instalments for SMEs in the coming months. SMEs can get small loans approved within 24-hours using their mobile phones. We will keep the public updated in due course.”

1 http://www.thejakartapost.com/news/2018/04/24/government-marketplaces-team-up-to-encourage-smes-to-go-online.html

Public To Take Note

On 27 April 2018, MC Payment as well as its shareholders and bondholders entered into a conditional sale and purchase agreement with Artivision Technologies Ltd. (a company listed on the Catalist board of the SGX-ST) for Artivision Technologies Ltd. to acquire all the ordinary shares and convertible bonds issued by MC Payment. The proposed acquisition, when successfully completed, will result in a reverse take-over. The proposed acquisition and its due diligence are in progress and have not been completed as at to-date.

This announcement has no material effect on the proposed acquisition.

Veteran fintech startup MC Payment announced that it will fully acquire iFashion Group, an online fashion and lifestyle retailer in Singapore.

MC Payment already owns 51 percent of iFashion and will buy the rest of the firm, according to documents filed with the Singapore Exchange (SGX). The value of the additional stake is equivalent to two times the audited consolidated revenue of the iFashion Group for 2017 and could reach as high as US$18.7 million.

There will be no major changes in management as a result, the companies say.

Before getting acquired itself, the lifestyle platform had been growing via acquisitions, snapping up fashion and ecommerce labels in Southeast Asia, including Dressabelle, Megafash, and Invade. iFashion said last year that it planned to go public by the end of 2017, likely in Australia or Europe.

“Ultimately, ecommerce is a fast-moving landscape and the demand for cashless payments and efficient purchase processes is picking up at an incredible pace,” says Jeremy Khoo, CEO of the iFashion Group. The planned IPO was meant to help the company grow quickly and capture more of the market, but this way it can count on MC Payment’s technological support to expand its business.

The documents state that the acquisition will “allow [MC Payment] to offer payment solutions to the diverse range of retail businesses within the iFashion Group.”

The two companies worked together before. MC Payment partnered with iFashion last year for the launch of a US$2.5 million offering of its MegaX token. The cryptocoin was meant to be used as a cashless payment method across the group’s cluster of retailers. The Group is now developing a digital wallet to spread the use of the coin at its offline events, and boost its data analytics capabilities to analyze merchants’ understanding of their customers.

MC Payment CEO Anthony Koh tells Tech in Asia the acquisition will give the fintech company more avenues to “provide a wider range of online-to-offline solutions,” making the most of iFashion’s reach. The group claims its retail network covers “over 1,400 independent brands,” including retailers, ecommerce portals, events spaces, and more.

Having developed a number of payment products, MC Payment submitted a plan for a cashless payments protocol for Singapore last year, when Prime Minister Lee Hsien Loong put out a call for proposals.

MC Payment’s proposal for a payments system in hawker centers, in collaboration with iFashion-owned Artbox, came on the heels of Razer’s response to the prime minister’s call. The Razer proposal recently developed into a partnership with telco Singtel.

The payments startup also partnered with restaurant operator Sakae Holdings to develop a blockchain product and launch Bitecoin, an Ethereum-based token for transactions in the food and beverage industry.

Going public on SGX
At the same time, MC Payment and SGX Catalist-listed Artivision Technologies have agreed to go forward with a deal first announced late last year, where MC Payment will acquire the latter – a move that will result in a reverse takeover.

In a reverse takeover, a company goes public on the stock market by having an already-listed firm that’s usually in decline buy up all of its share capital.

The Artivision-MC Payment deal was initially pegged at US$59 million, but the consideration might go up by US$15 million, pending a new fundraise of up to US$9 million by MC Payment. The conditional agreement is subject to shareholder approval.

The entire deal consideration, including MC Payment’s acquisition of iFashion, will total around US$93 million and will be paid through the issuance of 446,428,570 shares at a price of US$0.21 per share.

“The reverse takeover will provide a good platform for us to raise further funding should we require it in the future,” MC Payment’s Koh says. “It is extremely meaningful in providing us greater access to the broader investor community and in raising our profile.”

The company hopes to take advantage of the regional trend in developing borderless transactions, having established a presence throughout Southeast Asia and in Australia and China. “We see a burgeoning need for a bridge that transcends countries, industries, sales channels, and currencies, be it digital or traditional,” he adds.

MC Payment is the second fintech startup to attempt a listing through reverse takeover on SGX. Fintech group Ayondo, which offers social trading and brokerage services, planned to list through a US$118 million acquisition by developer Starland Holdings, but the deal fell through.

Cashless may be the buzzword of the day but for home-grown firm Mobile Credit Payment (MC Payment), cashless technology has been its bread and butter for nearly two decades.

As early as the turn of the century, the payment solutions firm had developed technologies for mobile phones – like then popular brands Nokia and Motorola – to carry out monetary transactions on the go.

This was well before the days of the smartphone, which took off only in the late 2000s.

“We came up with a software that allowed customers to pay using a credit card through the Nokia cellphone, and for merchants to accept credit card payments via the phone,” said MC Payment founder and chief executive Anthony Koh. “We also deployed it to taxis.”

Its limited capabilities restricted its use but he added that the situation could partly be due to the lack of regulations as well. As a result, the platform did not give MC Payment the big break Mr Koh had hoped for, but he was undeterred.

MC Payment reached its first major milestone in 2010, when the firm, in a tie up with an international merchant bank, rolled out a mobile point-of-sales system on smartphones, allowing the bank’s insurance agents to sell their products on the move.

“This helped to show other financial institutions that we have the technological capabilities to support and grow their businesses,” said Mr Koh.

“But, of course, it was a very long process. It took more than a year for them to be convinced by a start-up like us,” he added with a laugh.

MC Payment now has about 60 employees, with a presence in Singapore, Malaysia, Indonesia, Thailand, Cambodia, Sri Lanka, Hong Kong and Australia. It provides services to over 2,000 merchants, and its proprietary products include e-wallet applications, business-to-business invoicing and payments processing, mobile point-of-sale systems, and non-cash payment products.

The firm is also slated to be among the first fintech firms to be listed on the Singapore Exchange.

Last October, Catalist-listed Artivision Technologies said it has entered into a conditional and non-binding proposal to buy all of MC Payment for $80 million. The acquisition, if done, will result in a reverse takeover of Artivision.

The proposed acquisition comes amid a push for cashless payments in Singapore.

“Artivision’s acquisition of one of Singapore’s earliest fintech firms is timely as it allows its shareholders to participate in a business with a proven business model, which has the potential for significant growth,” the two firms said in a statement at the time of the announcement.

MC Payment has recently also submitted a proposal in response to the Government’s request for information on a cashless payment solution.

Said Mr Koh: “As a listed firm, the clear advantage will be more credibility, so we can work with larger banks and players in this region, and they can have more confidence in us.

“We also plan to use the listing platform to scale up and expand, so that we can achieve our goal in a shorter time. It’s all about timing and the readiness for growth, and right now, we are at a stage where we should embark on a new journey for further growth.”

Mr Koh said MC Payment’s total revenue last year was $11.4 million. It is not yet profitable, given the heavy investments in technology and infrastructure, but the firm aims to turn in its first profit next year.

“The main focus now is still scaling up. If we focus on only profitability, it will be at the expense of growth and entering new markets, which is an investment in itself,” he said, adding that it “should be enjoying the fruits of our labour very soon”.

For MC Payment, the next step is to expand further into new markets, such as the Philippines and Vietnam, in the coming two years.

Mr Koh said many consumers in South-east Asia, especially in the emerging countries, still face challenges with cashless payments – a gap it aims to fill.

In addition, the region’s large population, coupled with China’s One Belt One Road investments, all spell opportunities for growth.

He said: “But the payments landscape is changing very fast. I see this window of opportunity opening up, and we don’t know when it will close. With the changing landscape, increasing competition and consolidation likely happening in the years to come, we see an urgency to grow faster, and establish a foothold in the region. If we miss that, we’ll become outdated.”

At the same time, MC Payment is moving into various vertical businesses, including retail. For instance, it worked with local online fashion platform iFashion Group this year to develop digital tokens for use across iFashion’s retail network, both online and at brick-and-mortar stores. The tokens aim to create a new “movement” for millennial spending, he said.

MC Payment has also grown through its recently acquired unit Genesis Payment Solutions, which is licensed by Chinese online payments provider Alipay to acquire merchants. Genesis has deployed hundreds of QR code payment solutions for local retailers such as Royal Sporting House and the Robinsons department store.

Mr Koh said the firm’s broader goal is to become “one of the leading brand names in the region that people look for in the unified payments platform space”.