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| DineroMail - EQ |
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| Summary of Proposed Investment |
| This Summary of Proposed Investment is prepared and distributed to the public in advance of the IFC Board of Directors’ consideration of the proposed transaction. Its purpose is to enhance the transparency of IFC’s activities, and this document should not be construed as presuming the outcome of the Board decision. Board dates are estimates only. |
| Project number | 27406 |
| Company name | DineroMail Inc. |
| Country | Latin America Region |
| Sector | Finance & Insurance |
| Environmental category | C |
| Department | Global Inform. & Comm. Tech. |
| Status | Active |
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| Date SPI disclosed | May 8, 2009 |
| Projected board date | June 9, 2009 |
| Previous Events | Invested: September 2, 2009
Signed: June 26, 2009
Approved: June 23, 2009 |
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| Overview |
Sponsor/Cost/Location |
Development Impact |
Contacts |
Attachments |
| Project description |
The proposed project consists of an equity investment in Dineromail of up to $5 million, as part of a round of financing initiated in 2008 to strengthen existing operations in Argentina, Mexico, Brazil, and Chile and enter new markets.
One of IFC’s strategic pillars is to support information and communications applications and IT enabled services across a broad range of sectors, the most prominent of which include finance and small business development. In that context, innovative use of technology to develop and improve payment systems as a way to improve access to finance exhibits enormous developmental potential and has become a key focus for IFC’s work in this area. |
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| Project sponsor and major shareholders of project company |
| Dineromail was founded in late 2004 by Alejandro Estrada (with a large experience in the financial industry) and Alec Oxenford (a successful internet entrepreneur). After some time developing the technological platform, getting the proper authorizations and recruiting the initial team, the company started to gain traction in 2006. Dineromail has already a significant presence in Argentina, and has also begun operations in Mexico, Brazil, and Chile. |
| Total project cost and amount and nature of IFC's investment |
| The proposed project consists of an equity investment in Dineromail of up to $5 million. |
| Location of project and description of site |
| Dineromail has already a significant presence in Argentina, and has also begun operations in Mexico, Brazil, and Chile. |
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| Anticipated development impact of the project |
The anticipated development impacts of the project are:
Access to financial services to unbanked: The project will help improve access to basic financial (payment) services for un-banked segments of the population, as Dineromail’s model allows for simple and secure on-line access to financial services to such segments.
Increased business volume for MSMEs: MSMEs with no numbers for main credit cards (which do not assume fraud risk) will benefit from a simple and secure electronic payment method, increasing merchants’ current competitiveness vis-à-vis larger stores.
Promote connectivity: On-line payment platforms such as Dineromail’s end up fueling the demand for better internet connections among individuals and MSMEs. In turn, telecoms and broadband connectivity fuels the flow and exchange of ideas and innovation, directly leading to increased productivity. Connectivity and e-business in general are critical for helping LAC bridge the digital divide with more advanced regions. |
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| IFC's expected development contribution |
Stamp of Approval: While Dineromail has brought on-board recognized players in the internet, media and credit card markets, an involvement from IFC would help further improve corporate governance in preparation for an eventual IPO or block trade, and enhance visibility and recognition, critical for gaining the trust of small merchants across a wide array of countries to begin using this platform.
Replication in other countries: Dineromail is expanding its operations to several countries in Latin America. IFC’s presence and knowledge of the regions will be very helpful for the Company to successfully enter those markets.
Access to WB Group expertise / Knowledge sharing: WB and IFC have been accumulating regulatory expertise with regards to payment systems and services. Dineromail sees value in tapping such expertise, especially as it replicates its model into new countries within LAC.
Governance strengthening in preparation for an IPO: Dineromail sees an IPO in its future and believes IFC will help strengthen governance which will, in turn, boost its credibility in the public eye. |
| Environmental and social issues - Category C |
| As this project will focus on developing and marketing technology solutions using leased spaces in office buildings and data centers, environmental and social risks and impacts were assessed to be minimal, and the project has therefore been classified as Category C according to IFC’s environmental and social review procedure. |
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| For inquiries about the project, contact: |
Estrada, Ale
Uriarte 2489 2o Piso
Buenos Aires, Argentina
Business Phone: +54 11 5275 1700
E-mail: ale@dineromail.com |
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| For inquiries and comments about IFC, contact: |
General IFC Inquiries
IFC Corporate Relations
2121 Pennsylvania Avenue, NW
Washington DC 20433
Telephone: 202-473-3800
Fax: 202-974-4384
E Mail: Webmaster |
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