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EML Payments to liquidate PCSIL

Wednesday 24 January 2024 15:05 CET | News

Australia-based EML Payments has announced it is winding down its Irish subsidiary, PCSIL, stating the business is no longer commercially viable and sustainable. 

According to the official announcement, the High Court was told that PCSIL is solvent, but that the winding up petition was being brought on the basis that its business model is loss-making and not commercially viable.  

Moreover, the Australia-based paytech revealed that PCSIL, the prepaid card provider acquired in 2019 for its digital banking and multi-currency services, is projected to incur a USD 13.1 million deficit in FY24 if the current operational model continues. 

Australia-based EML Payments has announced it is winding down its Irish subsidiary, PCSIL, stating the business is no longer commercially viable and sustainable.

The court also heard that the company, which holds EUR 516 million of segregated funds for customers with 2.4 million prepaid cards in issue, expects to be in a position to pay all of what it owes its creditors. 

In a statement following the development, the Central Bank said the joint provisional liquidators will continue to assess the solvency on an ongoing basis, throughout the liquidation process. 

The announcement also mentioned that PCSIL and Interpath have committed that all current card holders can, subject to new limits, continue to load funds to their card until 17 July 2024 and can continue to spend on their cards up to 17 January 2025 subject to certain changes and their terms and conditions. 

EML Payments said the action would conclude a period of significant earnings losses, cash burn and management distraction from operating PCSIL. Going forward, EML’s remaining exposure to PCSIL is limited to USD 13 million of cash outflow, for the repayment of intercompany balances. 

Moreover, there will also be a one-off non-cash impairment charge of around USD 16.5 million arising from the liquidation representing the removal of net assets of the PCSIL business and any associated intangibles from EML’s financial statements. 

What does EML Payments do? 

EML Payments is a payments provider that offers customisable, secure, and feature-rich payment solutions for businesses and their customers. They support payments 24/7 globally anytime, anywhere, wherever money is in motion, with over USD 80 billion transacted on their platform annually, according to the company. 

In May 2023, the paytech worked with Visa to offer its private label digital gift cards for shopping centres in the US and Canada. The EML and Visa collaboration sought to introduce a convenient digital gift card solution. Thanks to secure mobile authentication, customers can now seamlessly purchase and instantly deliver gift cards online while enjoying a safe and seamless experience. 

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Keywords: paytech, payments , prepaid card, digital banking, financial services
Categories: Payments & Commerce
Companies: EML Payments
Countries: Australia, Ireland
This article is part of category

Payments & Commerce

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EML Payments

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