Brahma explained that the company had responded to a July 15, 2020 request for proposal (RFP) from Menteri Besar Selangor Inc (MBI) for a plan that would lead to Selangor becoming a premier smart state by 2025.
The goal was to be achieved through the transition of the state government’s payment and disbursement system from conventional methods to digital payments through an e-wallet.
Brahma said Wavpay participated in a series of presentations from July 2020 to June 2021 for which it was evaluated and was even asked for clarification.
It was also put through an initial round of due diligence procedure before it was shortlisted for the final presentation on June 11, 2021.
Brahma said that on June 28, 2021, Wavpay was officially informed by Selangor E-Wallet Sdn Bhd (SEW), a subsidiary of MBI, that it had been selected as the state’s e-wallet and cashless initiative partner.
He said the company was then put through a second evaluation process from August 2021 to February 2022, during which a “rigorous” due diligence procedure by “reputable consultants” was conducted.
“The process involved an examination of our technology, commercial, financial, tax and legal aspects,” he said.
On completion of the due diligence process, SEW acquired a 49% stake in Wavpay which includes its subsidiaries.
The process of the joint-venture arrangement between Wavpay and SEW was also detailed at the Selangor state assembly sitting in August 2022.
“This marks Wavpay’s commitment to transparency and accountability as we have nothing to hide,” Brahma said in response to allegations of wrongdoing that have gone viral on social media.
He pointed out that prior to the agreement execution with SEW, its subsidiaries Wavpay Systems Sdn Bhd and Wavpay Credit Sdn Bhd already had paid-up capital of RM9.04 million and RM1.1 million respectively.
“These amounts are a direct reflection of the equity allocation subscribed by SEW, amounting to 49% ownership in Wavpay,” he said.
Brahma stressed that the company had consistently adhered to all requirements under the regulatory framework.
“Both Wavpay Systems and Wavpay Credit secured the necessary approvals and licences for their respective operations,” he said.
Wavpay Systems is an e-money issuer approved by Bank Negara Malaysia to operate the e-wallet while Wavpay Credit operates as a licensed moneylender in accordance with the Moneylenders Act 1951.
On concerns about the equity distribution between the Selangor government and the majority shareholder, Brahma said claims that question the legitimacy of its ultimate corporate shareholder CT Frank Technology (M) Sdn Bhd were “unsubstantiated” and “devoid of factual basis”.
He said the Frank Group of Companies, to which CT Frank Technology belongs, has reported a cumulative profit of RM75.6 million within the group in the decade from 2012.
“We fully acknowledge the concerns voiced by the public and wish to reaffirm our unwavering commitment to the highest standards of transparency, accountability and corporate governance,” Brahma said.
“The allegations against Wavpay and its subsidiaries are baseless on all accounts. We reaffirm our dedication to maintaining the trust of our stakeholders and the large public,” he added.