ICFG – after reverse takeover, market newcomer specialist in emerging country microfinance, looks to have multi-national expansion potential with 1.4bn ‘unbanked’, shares now just 49p

13.02.2025

After a somewhat lengthy process, the 2022-quoted Main Market listed shell Fintech Asia (LON:FINA) has acquired a very interesting microfinance business and following the ‘reverse takeover’ is now to be renamed as ICFG.

Looking at its spread of activity, I would reckon that its shares have a very interesting upside from the current price of 49p.

Fintech Asia

The Company was incorporated in Guernsey on 28th May 2021 for the purposes of acquiring one or more companies or businesses in the financial technology sector, commonly referred to as ‘fintech’, that offer new technologies that seek to improve and automate the delivery and use of financial services in Asia or from Asia into the Western economies.

It was admitted to listing on the Main Market on 15th September 2022.

The search for a potential transaction was funded from the cash raised on admission of the Company to the market.

Trading was suspended on 14th March 2023 following a request by the Company.

The Company raised a total of £1,445,000 (before expenses) through the placing of 3,010,000 ordinary shares in conjunction with the IPO and the formation of the Company through an initial placing and a founder subscription.

It proceeded with carrying out its stated strategic objective of attempting to acquire one or more companies or businesses in the financial technology sector, focused on improving the delivery and use of financial services in Asia.

During that period, it identified and considered the potential suitability of a number of acquisition targets and entered into initial discussions, including with what is now the ICFG group.

ICFG Limited

The target was initially a traditional financial services and product provider and has extensive experience and knowledge in the financial sector in Central Asia.

Over the past five years, the target has developed group technology infrastructure through its group in-house IT development entity, AILL, aiming to merge traditional financial business operations into an innovative fintech-based model before developing into a ‘neo bank’.

ICFG specialises in microfinance, using advanced technology to provide a competitive edge and create a business model that can grow easily.

Originally established in Mongolia, the company has recently started expanding into other countries in Central Asia.

It was founded in Ulaanbaatar, Mongolia in 2016 by Mongolian and Japanese investors.

Its Business Model is to bring the two primary strategies of being a Comprehensive Financial Service and Product Provider and Innovative Fintech Solutions & Extensive Fintech Platform Provider to the market effectively and ICFG has established four distinct but interrelated businesses, being micro-finance, investment banking, real estate, and IT and AI technology.

ICFG has a reliance on its four funding sources, with its lending activities primarily funded by customer trust deposits, third-party bank loans, public and private bonds and retained earnings.

The group has a total of 527 employees across its business units operating in Singapore, Mongolia, Kyrgyzstan, Kazakhstan and Uzbekistan.

Target Market Overview

The World Bank reported in 2022, that globally, approximately 1.4bn adults remain unbanked.

In Central Asia and in South East Asia, being the group’s principal areas, from 2011 to 2021, bank account ownership doubled, from an average of 25% to 58% in Central Asia and from an average of 39% to 62% in South East Asia.

Receiving or sending digital payments also saw a sharp increase compared to high-income economies, which further demonstrates the correlation between account holders and the likelihood of using other financial services.

Almost two-thirds of digital payment recipients also used their account to store money for cash management; about 40% used their account for saving; and 40% of payment recipients borrowed formally from a financial institution.

Group Business Strategy

The Board believes that there exists in the underbanked population a limited awareness of financial products and services and even if they possess such awareness, they face challenges in reaching these due to the absence of requisite infrastructure and service providers.

The Equity

Following the reverse takeover there are now 203,957,116 shares in issue.

The largest holder is Ankhbold Bayanmunkh with 35.75%, who is part of the Concert Party behind the enlarged group, which will hold 80.89% of the ICFG equity.

In My View

Taking a look at the spread of this enlarged group’s activities, its connections and assessing its potential as it progresses as a fully listed UK-quoted entity, I feel very positive about its prospects to really use its quote to expand its multi-national business.

I would now look forward to a steady flow of corporate news from the group, starting with a Trading Update within the next month or so.

As the year moves on, I would also expect the enlarged group to attract institutional investor support for its equity, probably through a fundraise as its overall business model adapts to its quoted status.

Its shares at just 49p could well offer a very strong upside as the group’s Management starts to utilise its new structure and its quoted status.