RentPay to go ahead with reduced funding

Rental property website operator and aspiring rental payments processor Rent.com.au will push ahead with the development of its RentPay business, despite having to scale back its capital raising plans to fund the initiative.

Last month, the company announced that it had entered into a partnership with payment services provider Novatti to develop a rental payment service.

The plan is for Novatti to integrate its payment technology into the Rent.com.au's subsidiary RentPay to provide an automated rental payments platform for tenants and agents. It will include administrative support for agents, such as automated missed-payments communications.

On the capital side, Novatti will acquire a 2.5 per cent shareholding in Rent.com.au's subsidiary RentPay Technology Pty Ltd for A$250,000, with an option to increase the stake to 10 per cent.

And Rent.com.au launched a non-renounceable rights issue, seeking $2.9 million of equity capital for RentPay product development and marketing.

On Friday, the company announced that it had cancelled the rights issue. Instead, it made a placement to existing shareholders, raising $750,000.

Rent.com.au chief executive Greg Bader said in a statement: "Given the volatility and uncertainty affecting the sharemarket, we have decided to conduct a smaller placement to current major supporters of the business, which we believe is sufficient to get RentPay launched."