We´re informing the investors that ClickCash has not executed buybacks as per the agreement. We have been in discussions with ClickCash since September when the first buyback purchases were delayed, and since then, they have shown goodwill in cooperation and periodically transferred funds to us, paying down the open balance gradually.
However, we did not receive the agreed payment this week, so we are now assessing different options on how to proceed. We still remain in active communication with the ClickCash management to resolve the situation amicably. The listing of new loans from ClickCash is suspended.
We have requested ClickCash to use all proceeds coming from the pledged loan book to be used towards payments for investors while we assess the situation and continue the discussion with the management and ClickCash shareholders. Full clarity on the situation and their ability to continue paying voluntarily should be ready within November, as well as the status of pledged loans and collecting them directly.
The original balance at the time problems with payments arose was €246 878, out of which ClickCash has paid back €64 000 (26%). The outstanding balance as of today, 10.11.2022, is 182 878€.
The information we have today is the pledged loan book quality has deteriorated and is weaker than we expected, making the decision on legal collection even more challenging. The Click Cash management is trying to find solutions, and we have also engaged their investors, including the Tolaram group, in the discussion. As the situation evolves and more info becomes available, we will keep you all updated.
We’d hope we have concrete information about expected recoveries or about a solid payment agreement still during November. Personally not happy at all about this, but hopefully, we will get to a good outcome nevertheless.
We are currently assessing different options, including enforcing the pledge and legal collection. During our discussions and with the information we have today, the pledged loan book quality seems to have deteriorated and is weaker than we expected. We need to consider the loan book quality when deciding on the possible legal collection, which will incur additional costs and take time.
We aim to keep investors updated as things progress, and we are doing our best to solve the situation with ClickCash as soon as possible. Still, legal proceedings and the collection of information takes time. Please note that also in the case of enforcing the pledges and starting collection directly from the loan book, the investors will be paid from the cashflow coming from the book. Estimated time for this is between 6-8 months.
According to the data we have at hand today, the cash-flows from the pledged book show an inflow of approximately €50K as per original borrower payment schedules. The lower than expected cash-flows seem to be the result of relatively fast deterioration of the pledged loans and ClickCash not keeping the pledges at the agreed level. We are currently making further inquiries to them on the pledges and why they are under-performing.
We have this week reached and understanding with ClickCash that all cash coming from the book will be forwarded to us. The recovery is expected to take until the book completely matures, with the last payment estimated to happen in August 2023. Between now and then, ClickCash will make us bi-monthly repayments from the cash-flow, with the first payment agreed to happen next week.
In addition to the above, the ClickCash management and shareholders are trying to find solutions to fulfill their contractual obligations and to enable a full recovery to Income investors. We are in active discussions with them and will update investors as new information becomes available.
ClickCash (Credito 24 LTDA) is a Brazilian non-bank financial company (Fintech) that offers consumer loans to its customers via a proprietary “mobile only” process that enables it to tap into alternative credit data and detect fraud efficiently. ClickCash’ largest investor is Singapore based Tolaram Group.