Nagad, the mobile financial service arm of the Bangladesh Post Office, has secured the final go-ahead from Bangladesh Securities and Exchange Commission (BSEC) to raise Taka 510 crore through a zero-coupon bond to expand business, extend services and pay off loans.
The company got this approval to sell bonds only to corporates and other eligible investors through private placement, according to sources familiar with the matter, reports BSS.
In this way, Nagad Limited is expected to become a profitable company, hoped the authorities concerned.
Talking about it with BSS, Muhammad Zahidul Islam, head of public communications, Nagad, said, "The number of customers boarded by Nagad, the world's fastest expanding mobile financial service, has surpassed 7 crore. To serve such a huge customer base in a better way considering future needs, the money raised through the bond will be spent on building digital infrastructure, developing networks, repaying current debts and procuring IT equipment, also on marketing and promotional activities."
Thus, Nagad will work on opening a new horizon for customers so that they feel encouraged to go for cashless transactions, reducing the use of cash, he added.
This would be a transferable, redeemable, non-convertible zero-coupon bond having a tenure of five years. The coupon rate may go up to 10 percent. The company hopes that they will make profits within the next five years using the money raised through the bond.
Since its inception on March 26, 2019, Nagad has gained a stronghold in the MFS market, thanks to its one after another newer innovations. The company has also ensured digitalisation in the financial industry.
Nagad's daily transactions now stand at Taka 1,200 crore on average as it offers customers affordable services.
Mentionable that on May 17, the Bangladesh Bank issued a circular, giving its final seal of approval to a new non-bank financial institution named "Nagad Finance PLC".