STOCKHOLM (Reuters) -Swedish payments firm Trustly said it is still aiming for a stock market listing but there is currently no firm timeline, after it delayed IPO plans following comments by the country’s financial regulator about the company’s due diligence process.
Trustly in April announced plans to list on the Nasdaq Stockholm exchange in a move that could have valued the company at more than $10 billion.
However, less than two weeks after the announcement the Swedish Financial Supervisory Authority (SFSA) said the company should perform due diligence on some customers using Trustly’s payment initiation service to make payments to merchants.
The board has decided not to pursue the plan for a listing in the second quarter, but the ambition to list remains, Chairman Johan Tjarnberg said in release accompanying first quarter results.
Chief Executive Oscar Berglund told Reuters that the company now had the opportunity to offer its views and observations, including on how its payment solution fits into the regulatory framework.
“The payments sector is evolving very fast and account-to-account is a fairly new product so it’s natural that from time to time it becomes a discussion around how different rules and legislation should be interpreted,” he said.
The appeal of financial technology companies has increased during the COVID-19 pandemic as more people shop online and make payments digitally to avoid physical contact. Swedish peer Klarna is also exploring a public market listing.
Trustly, which allows users to pay for purchases directly from their bank accounts, reported a 46% jump in net revenue to 632 million Swedish crowns ($74.86 million) in the first quarter, backed by growth in North American markets.
“I am convinced that everyone understands that to push ahead with a listing if there is uncertainty around the SFSA process is not responsible,” Tjarnberg told Reuters.
($1 = 8.4427 Swedish crowns)
(Reporting by Supantha Mukherjee in Stockholm; Editing by Simon Johnson, Kirsten Donovan)