UK-based PayPoint has invested a total of GBP 13.5 million in Open Banking solution provider obconnect to unlock mutual growth opportunities. obconnect is an early-stage technology platform with the capabilities to provide complete market ecosystems across Open Banking, finance, data, energy, Confirmation of Payee, and enhanced fraud data.

This investment and partnership have enabled PayPoint to leverage this technology platform and range of capabilities, offering Open Banking services to both new and existing clients. An increased stake due to beneficial partnership PayPoint's partnership with obconnect has exceeded expectations, securing over 25 clients for Open Banking services, including major names like American Express. obconnect has also gained contracts with banks, industry recognition, and is set to achieve profitability by H2 2024.

Given this progress, PayPoint has agreed to make a further strategic investment in obconnect, increasing its interest to 59.3% of obconnect. This investment will further leverage obconnect’s Open Banking technology platform and unlock greater opportunities within both the PayPoint business and obconnect’s new business streams working with a number of key financial institutions and payment organisations. The investment comprises the GBP 3.0 million original convertible loan note, which will now be converted into ordinary shares along with a new investment of GBP 10.5 million in cash which, combined, will give PayPoint a 59.3% interest in obconnect.

PayPoint secures option to fully acquire obconnect The agreement also includes a put option for PayPoint to obtain the remaining 40.7% of obconnect for a total cash amount of up to of GBP 20.0 million, with the consideration dependent on future performance. The put option is exercisable over three annual instalments commencing 31 March 2025 with up to 10% puttable by March 2025, up to 25% (in aggregate) by March 2025 and up to 40.7% by March 2027. The investment is subject to regulatory approval, with completion expected in early October 2024.

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