(Alliance News) - Fiinu PLC shares fell on Friday, after it confirmed that it has withdrawn its banking licence due to a lack of funding.
Fiinu is a Weybridge, England-based digital bank that offers short-term credit to consumers via an arranged overdraft. Its shares were down 11% to 11.33 pence each in London on Friday around midday.
In March, Fiinu said it has raised GBP6.5 million through a fundraising split into three components. This included a subscription of 3.9 million shares at 13 pence each to raise GBP500,000, a conversion of an existing GBP2.5 million loan facility into up to 19.2 million new shares at a price of 13 pence each, and a GBP3.5 million draw down from a new three-year share subscription facility agreement which has a total maximum draw down potential of up to GBP40.0 million.
However, on Friday, Fiinu said that "continuing challenging capital market conditions have impeded this fundraising process".
It said that the lack of funding commitment has slowed the necessary regulatory application processes, so Fiinu, together with Fiinu Bank Ltd, have determined that a "preferential course to action" is to make an application to withdraw its licence aiming to re-apply after a short period of two to three months. This application has now been submitted to the PRA and FCA.
Fiinu noted that this will allow the company to focus on securing its exit funding requirement, which is estimated to be in the range of GBP34 million to GBP42 million.
In a separate announcement, Fiinu said it has conditionally raised GBP750,000. It explained that it has exercised its right to convert GBP750,000 of drawn down loans with Dewscope Ltd into 5.8 million new shares at a price of 13p each, together with 303,644 new warrants.
In June 2022, Fiinu entered into an unsecured facility agreement with Dewscope. Under the agreement, Dewscope agreed to make available a loan facility of up to GBP2.5 million for a period of two years.
Then in March, Fiinu entered into a further agreement with Dewscope. This allowed the company to convert all or part of the loan into new shares at a subscription price of 13p per share.
By Sophie Rose, Alliance News reporter
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