First Citizens buys 19.9% stake in Term Finance

First Citizens bank has acquired a 19.9 per cent minority stake in Term Finance (Holdings) Limited, a web-based credit institution.

A joint statement said this acquisition will now afford for First Citizens to fully leverage its digital capability and suite of banking services through Term Finance to thousands of under-banked individual customers and small businesses across the region, without requiring any shop-front footprint.

“The investment gives First Citizens a minority stake in Term Finance Holdings Limited, which owns and operates subsidiaries involved in micro-lending businesses in TT, Barbados, Guyana, Jamaica and St Lucia.

“The company has minority partners in Jamaica, St Lucia and in the newly established small-business (SME) lending arm in TT.”

It noted that First Citizens’ advisers on the deal were Pan American Finance, PricewaterhouseCoopers, Fitzwilliam Stone Furness-Smith & Morgan (TT), Floissac Fleming & Associates (St Lucia), Cameron & Shepherd (Jamaica), Chancery Chambers (Barbados) and Patterson Mair Hamilton (Jamaica).

The relationship between the two entities dated back to 2015, when Term Finance disbursed its first loan through Bank’s online banking system in TT.

“Since then, Term Finance has processed over 38,000 loan applications without ever having to meet a customer face-to-face,” the statement said.

Term Finance has expanded into regional territories such as Barbados, Guyana, Jamaica and St Lucia by leveraging a totally web-based platform and acquiring the various licenses required to support their operations in each market.

“Every application passes through the Trinidad based lending team and all customer service and collections operations are centralised to the head office in Port of Spain.

“Similar strategies have been executed in recent years by US based banks who invest in FinTech start-ups to acquire technology and access younger and underserved segments of the banking market.”

Term Finance’s suite of products include consumer credit , small-business credit , eCommerce with product financing (www.mytfshop.com) and pre-paid MasterCard services powered by First Citizens (www.mytfcard.com).

First Citizens, headquartered in TT, has an asset base of US$7.1 billion. It also has operations in Barbados, Costa Rica, St Lucia, St Vincent and the Grenadines