Tyro Payments shareholders are urging the company to give up its...

Tyro Payments shareholders are urging the company to give up its banking licence after a private equity buyer walked away from the target in recent weeks.The eftpos payment services business met investors last week and the feedback suggested that Tyro’s management and board should wind up its banking licence.Troubleshooters in the technology space late last year were saying that Tyro should hand back its banking licence to the Australian Prudential Regulation Authority APRA.

Closing the bank would free up capital to invest in technology and grow its core business of electronic payments through eftpos machines.Initially, the strategy was to use the bank to grow its customer numbers.The expectation was always that private equity firm Potentia would hand back the banking licence if it acquired Tyro Payments.Tyro counts Grok Ventures, the private company of Atlassian co-founder Mike Cannon-Brookes, as a 12.5 per cent shareholder. It is understood Grok wants the business to be sold.Regal Funds, which was a 7 per cent shareholder, has sold down.Private equity firm Potentia Capital last month abandoned plans to buy Tyro for more than $832m because of the difficult outlook.An earlier offer for the company at $1.60 per share was rejected by Tyro’s board, as was an earlier offer at $1.27 per share.

Shares in Tyro closed up 1c to $1 on Friday, taking its market value to $520m. Observers have argued that Tyro would be better off in the private market because it needs capital to grow, while investors are punishing technology companies that are unprofitable.Tyro could be profitable, but at the expense of growth investment. NAB and Westpac considered an acquisition of the business but walked away. Some say the most logical buyer is a global strategic player.