Digital commerce software provider Ovanti (ASX: OVT) has signed a licensing agreement with BNPLPay Protocol to support future debt funding.

BNPLPay Protocol is a blockchain-based lending platform tailored for the Buy Now, Pay Later (BNPL) sector, with its decentralised finance network connecting stablecoin investors with BNPL providers.

Under the licensing agreement, Ovanti will have access to BNPLPay’s lending platform on a preferential basis for 20 years.

Strategic solution

Ovanti executive chair and interim chief executive officer Daler Fayziev said the agreement is a strategic solution to the company’s long-standing debt-funding challenges.

“Traditional banks and non-crypto lenders have historically offered financing on less favourable terms—often at high interest rates and with onerous requirements like first-loss,” Mr Fayziev said.

“By contrast, BNPLPay Protocol provides us with a much more affordable capital source and does so without the need for any first-loss contribution from our side.”

” We view this partnership as a significant milestone for Ovanti–it not only secures low-cost funding for our BNPL operations but also lets us share in the success of the BNPLPay Protocol through a revenue stream.”

BNPLPay ecosystem

Ovanti will also play a key role in the BNPLPay ecosystem and benefit from a 50% share of the protocol’s revenues for 20 years pursuant to the terms of the licensing agreement.

“This long-term agreement positions Ovanti as both a featured user and a partner of BNPLPay Protocol, forging a deep alignment between the two companies,” Mr Fayziev said.

Under BNPLPay’s decentralised lending model, Ovanti is able to draw on a pool of stablecoin-backed lenders at interest rates several percentage points lower than those charged by banks or other non-crypto financiers.

No first-loss capital is required from Ovanti to utilise the BNPLPay Protocol’s funding.

Financial consideration

The financial consideration for the licensing agreement is $2,393,383.

OVT is backing the acquisition with a placement to raise approximately $1.5 million.

The placement will involve the issue of 235,000,000 shares at $0.00655 each to sophisticated investors, with a further 135,000,000 shares issued at the same price to BNPLPay Protocol.