Zepz, the parent company of WorldRemit and Sendwave, has secured $165 million in new debt financing to enhance its financial position and drive global expansion. The package includes a $110 million revolving credit facility led by HSBC Innovation Banking and a $55 million term facility underwritten by HSBC Private Credit. This financing replaces a previous $80 million arrangement, further reinforcing the company’s decade-long partnership with HSBC.

Expanded Financing for Growth and Innovation

The financing package is designed to support Zepz’s strategic initiatives, including faster transaction processing, optimized transfer fees, and global expansion in the digital remittance market. The revolving credit facility features an "accordion" clause, allowing Zepz to potentially increase borrowing by an additional 60 million with lender approval. Additionally, the 60 million with lender approval. Additionally, the 55 million term loan comes with a 30-month maturity period, further solidifying the company’s financial foundation.

Strengthening Financial Flexibility

Barrie Morris, CFO of Zepz, emphasized that the new facility significantly lowers borrowing costs compared to the previous arrangement, which carried an interest rate of 14.73%. This reduction in financing expenses enhances the company’s ability to deliver cost-effective services while maintaining high-quality remittance solutions. The improved financial structure also positions Zepz to invest in operational enhancements and long-term growth strategies.

Commitment to Customer Empowerment

Mark Lenhard, CEO of Zepz, highlighted that the additional capital will enable the company to refine pricing models and drive innovation in its remittance platforms. By empowering migrants with more efficient and affordable financial tools, Zepz aims to help users overcome economic barriers and build secure futures. The company’s focus on customer-centric solutions remains a cornerstone of its growth strategy.

Challenges and Late Financial Filings

Despite the positive financing news, Zepz faces scrutiny over delayed financial filings, with its audited accounts for Zepz Technology Services Limited overdue by nearly eight months. The late submission, originally due by August 8, 2024, may result in regulatory penalties. However, the parent company, WorldRemit Holdings, has previously stated that it remains "strongly capitalized" and well-positioned for sustained growth.

Previous Funding and Investor Confidence

The 165 million debt financing follows a 165 million debt financing follows a 267 million Series F funding round in June, led by Accel with participation from TCV and Leapfrog. Notably, investors in the Series F round receive a 14.5% annual dividend, reflecting strong confidence in Zepz’s market potential. This continued investor support underscores the company’s resilience in a challenging fintech funding environment.

Industry Recognition and Strategic Partnerships

Angela Mylrea, Head of Corporate Credit Solutions at HSBC Innovation Banking UK, expressed enthusiasm for the deepened collaboration with Zepz. She emphasized HSBC’s commitment to supporting high-growth fintech companies that demonstrate innovation and scalability. The partnership aligns with Zepz’s mission to transform cross-border payments through technology-driven solutions.

Zepz’s latest $165 million financing marks a significant milestone in its journey to expand and enhance digital remittance services globally. With improved financial flexibility and a strengthened partnership with HSBC, the company is well-equipped to innovate and deliver value to its 9 million users. Despite regulatory challenges, Zepz’s robust funding trajectory and strategic vision position it as a key player in the evolving fintech landscape.