Japan’s SoftBank to buy 20% stake in bKash

Japan’s SoftBank has agreed to acquire a 20 per cent stake in bKash, one of the largest mobile banking operators in Bangladesh.

BRAC Bank, the majority shareholder of bKash, approved the foreign investment in its board meeting on Wednesday.

“Tokyo-based company’s initial investment would be impressive,” BRAC Bank Chairman Ahsan H Mansur told The Business Post.

The bank’s board approved the execution of a share purchase and subscription agreement amongst bKash and its existing shareholders, said BRAC Bank in a statement.

The existing shareholders included BRAC Bank, Money in Motion LLC, International Finance Corporation, Bill & Melinda Gates Foundation, Alipay Singapore E-Commerce Private Limited and Board of Trustees of bKash Employee Share Option Plan Trust, and the proposed investor, SVF II BEAM (DE) LLC (SoftBank), it said.

In line with the terms and conditions of the agreement, both primary and secondary investments will be made by SoftBank in bKash, whereby SoftBank will acquire 20 per cent share (on a fully diluted basis) of bKash, said the bank.

There will be no changes to the number of shares held by BRAC Bank in bKash and, on completion of the transaction, BRAC Bank will continue to remain the majority voting shareholder of bKash, it added.

The agreement is subject to the relevant regulators’ approvals.

“The fund will be invested in upgrading bKash with new technology, which is one of the fastest ways to stimulate growth and make a business more competitive. Effective business technology management will make all the difference for the company,” said a source at the mobile financial operator.

“The latest investment round validates our dedication and relentless efforts over last ten years and places its trust on the potential of a well-regulated fintech space. It is a significant vote of confidence on the current, and future, the growth trajectory of bKash,” said bKash Founder and Chief Executive Officer Kamal Quadir.

It also paves the way to attract global investment for other entrepreneurs and innovators of Bangladesh by showcasing the successful digital transformation of our country and its economy, he said.

“Broadening access to financial services can be critical to building a robust economy. We believe that bKash is strengthening Bangladesh’s financial system by providing a safe and convenient way for people to adopt digital payments,” said Greg Moon, Managing Partner at SoftBank Investment Advisers.

Of the total equity shares of bKash, BRAC Bank holds 51 per cent, USA’s Money in Motion LLC 29 per cent, International Finance Corporation (IFC) 9.9 per cent, and Alipay Singapore 10.1 per cent, according to the latest financial report of BRAC Bank.

In bKash, Bill & Melinda Gates Foundation invested in 2014, and Alipay Singapore E-Commerce Private Limited (Alipay) in 2018.

bKash has 56 million registered customers across Bangladesh.