For a cash consideration of Rs 31.1 crore, private sector lender HDFC Bank upped its shareholding in fintech start-up Mintoak from 5.2 percent to 7.75 percent.
The bank stated in a regulatory filing on December 14 that it will subscribe to 21,471 fully paid-up compulsory convertible preference shares (CCPS) with a face value of Rs 20 each at a premium of Rs 9,711, bringing the total consideration to Rs 9,731 per CCPS.
The private lender would buy 10,538 fully paid-up equity shares of Mintoak from certain existing Mintoak shareholders for Rs 9,731 per share.
The motivation for this move is mentioned as investing in a rising fintech business that provides payments and value-added services to its merchants and improves acquirers’ digital connection with merchants.
According to the lender, the agreements were executed on December 13.
Mintoak is a fintech startup that offers a payments-led platform that allows merchants to communicate with their consumers and acquirers to strengthen their relationship with merchants through digital engagements.
Mintoak’s yearly revenue grew from {60 lakhs in 2020 to {Rs 11.28 crore in 2022. In 2020, the fintech raised USD 20 million (Rs 16.5 crore) in its initial investment round. It presently services over 500,000 merchants across four banks in India and the Middle East region, with aspirations to attract 1.5 million users by the fiscal year 2023.
Subject to certain restrictions, the transaction is expected to be completed by January 31, 2023. Because the bank’s overall share in the deal will be less than 10%, regulatory clearance will not be required.
HDFC Bank invested Rs 10.3 crore in Mintoak in 2021, acquiring a 5.3% ownership in the firm on a fully diluted basis.
HDFC Bank introduced its SmartHub Vyapar Merchant app, built in collaboration with Mintoak, in October of this year. The SmartHub Vyapar Merchant app is a payment and banking solution for small and medium-sized enterprises that allows merchants to accept interoperable payments via Cards, UPI, and QR codes. Every month, the bank promises to add more than 75,000 businesses.
For merchants who need to become more familiar with technology and associated operations, the app provides the option of sending a payment link through mobile or email to ease non-face-to-face collection.
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