PIL Facts & Progress - A new Thread, page-16

Hi @jnene, I think you may need to give more consideration to the numbers.

• Cash burn is currently sitting around -$420,000 per quarter
• There is $3.1m in the bank as at 30 June. That's 7.4 quarters left or just under two years at current burn.
• Now if PIL are going to be operating a lending model they will need capital to put towards that. Let's say they allocated $2.0m to the lending model, and keep the balance ($1.1m) as working capital to run the business, advertise, etc - i.e. enough money to keep the lights on for (almost) another three quarters.
• So say they have $2,000,000 capital allocated towards the lending model. That really is not much to speak of. Yes the Aussie currency is much, much stronger than the Peso, but you're looking at say 10,000 customers being able to access maximum A$200 loans. By the way, that's assuming of the 55,000 agents, the take up on the lending model is around 18% (or 10,000 users). Just simple example numbers.

What kind of interest rates are PIL going to need to charge to actually get enough revenue to keep the lights on in the business? $2,000,000 is far too small a capital base, in my view, to be able to run a successful lending business in the Philippines. The most disastrous thing would be for them to launch the product, then have to call a stop to it because they don't have enough capital to meet the customer demand.

Now, read the announcement again.... "funds to support the initial roll-out of bizmoPay's operations..."

So, either they need to sort out a warehousing deal, or they need to raise a lot more capital....

Brushing off these questions with "$3 million in the bank!" doesn't make sense to me.