Australia’s booming fintech industry continues to soar on the global stage with regulatory tech company Identitii (ASX: ID8) the latest to see it’s early stage investment in Payble gaining global attention which will secure $1m in service fees on top of their 39.3% equity stake in the startup.
The $1m assignment fee will be payable over two years and has triggered the $0.7m investment made by x15ventures into Payble which diluted Identitii’s stake below 50%.
Validating the initial investment made by Identitii into Payble, an app for managing recurring payments to avoid the debt cycle, is the backing behind x15ventures which is Commonwealth Bank’s (ASX: CBA) venture capital division.
Although Identitii no longer own the controlling stake in Payble, they will continue to provide their regtech services with monthly fees receivable to increase as Payble’s revenue rises.
“Monetising previous investments in technology that no longer align with our core business is an important part of Identitii’s business strategy and I’m thrilled to announce today’s milestone, as we start to recognise income from Payble,” said Identitii CEO, John Rayment.
“This return on investment is validation of our monetisation strategy and we are increasingly optimistic that Payble will continue its early success as it looks to increase revenue and expand into new markets.”
Payble was originally founded in 2020 by Indentitii and Elliot Donnazzan, former Director of Innovation at Identitii to leverage open banking technology to make missed or late payments a thing of the past.
Under the new ownership structure, x15ventures holds 43.9% of the issued capital of Payble Pty Ltd, Identitii holds 39.3%, Elliott Donazzan 5.6%.
Between the three parties, Payable is hoping to capitalise on rising debt issues within the Australian community which has been accelerated by the rise of Buy Now Pay Later services where late payment fees can often exceed those of traditional credit card interest.
Across their suite of regtech solutions for the financial services industry, Identitii is set to capitalise major industry crackdowns where poor compliance resulted in Australian regulator AUSTRAC issuing $1.3 billion worth of fines in 2020.
That increased to $7.1 billion across the Asia Pacific Region.
Alfred Chan is a Business Reporter at The Sentiment specialising in ASX-listed small cap companies, a bloodstock enthusiast and former equities analyst.
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