1. Introduction

The Board of Directors of MPay wishes to announce that at the invitation of PT Finnet Indonesia (“Finnet”), ManagePay Services Sdn. Bhd., a wholly-owned subsidiary of the Company (“MPSB”) had on 20 December 2023 issued a Letter of Agreement (“LOA”) to Finnet which accepted and agreed by Finnet on 5 January 2024 to appoint MPSB to provide white label services for e-wallet and mobile application, namely Finpay Money Migrant which will have dual currencies in Ringgit Malaysia and Indonesian Rupiah.

The Indonesian e-wallet and mobile application of Finpay Money Migrant currently has more than 1 million customers in Indonesia. Finnet will on a revenue sharing basis reciprocate this white label e-wallet co-operation by powering MPay to issue white label MPay e-wallet in Indonesia. Finnet will also facilitate the outbound remittance of funds from the parents of Indonesian students studying in Malaysia to their Finpay Money Migrant e-wallet (RM) or their HomeRemit mobile application.

The LOA is subject to signing of MPay White Label Agreement between MPSB and Finnet and approval by Bank Negara Malaysia.

2. Information on Finnet

Finnet is a company incorporated under the laws of Indonesia and having its registered address at Telkom Landmark Tower, Lt 28 Jl Jenderal Gatot Subroto, Kav 52 Kuningan Barat, Jakarta Selatan 12710, Indonesia. Finnet was established on 31 October 2005 and is one of Indonesia’s leading digital payment service providers.

Finnet is owned by PT Telekomunikasi Indonesia, Tbk. (Cq. PT. Multimedia Nusantara) (“PT Telkom”) and Mekar Prana Indah (Yayasan Kesejahteraan Karyawan Bank Indonesia) for shareholdings of 60% and 40% respectively. PT Telkom is a state-owned information and communications technology enterprise and the largest telecommunications network in Indonesia. Whilst, Mekar Prana Indah is the Employee Welfare Foundation of the Central Bank of Indonesia. As a renowned Fintech services provider, Finnet offers a wide array of services in Indonesia such as remittance, digital payments, electronic money, Quick Response Code Indonesian Standard (QRIS) payments.

3. Salient Terms of the LOA

The salient terms of the LOA include, amongst others, the following:-

(a) to become MPSB’s white label partner for a e-wallet and mobile application referred to as Finpay Money Migrant which will have dual currencies e-wallets namely:-

(i) a e-wallet in Ringgit Malaysia (powered by MPSB); and

(ii) also a e-wallet in Indonesian Rupiah (powered by PT Finnet Indonesia);

(b) facilitate payment of e-salary to the Finpay Money Migrant mobile application of Indonesian migrant workers in Malaysia;

(c) facilitate contributions by Indonesian migrant workers in Malaysia from the Finpay Money Migrant mobile application, to the Social Security Administrative Body of Indonesia (“BPJS TK”) – outbound remittance from Malaysia;

(d) facilitate payments of E-compensation claims to the Finpay Money Migrant mobile application of Indonesian migrant workers in Malaysia, from BPJS TK – inbound remittance to Malaysia; and

(e) propose to the Indonesian Embassy in Malaysia on the proposed provision of payment services for Indonesian migrant workers in Malaysia.

4. Financial Effects

The LOA will not have any effect on the issued share capital and shareholdings of the substantial shareholders of the Company. The LOA is not expected to have any material effect on the net assets, earnings and gearing of the Company and its subsidiaries (“the Group”) for the financial year (“FY”) 2024. It is expected to contribute positively to the Group's revenue for FY 2025 onwards.

5. Directors’ and major shareholders’ interest

None of the Directors and/or major shareholders of MPay and/or persons connected with them have any interests, direct or indirect, in the LOA.

6. Statement by Directors

Having considered all aspects of the LOA, the Board of Directors of the Company is of the view that the LOA is in the best interest of the Group.

This announcement is dated 5 January 2024.