On September 26th, 2022, Holding RappiPay, a fintech company of Rappi, the first Colombian unicorn company, and Banco Davivienda, one of the main banks in the country achieved the first disbursement under a syndicated revolving loan granted by Bancolombia, Banco de Bogotá, Itaú and Davivienda four of the most important banks of Colombia, for COP$500,000,000,000,000 (US$115,000,000 approx.). The facility loan will be used by Holding RappiPay to, among others, originate consumer loans through its most recent product, the RappiCard digital credit card.

The legal structuring was carried by Mendoza, a specialized law firm in the legal structuring of complex financial transactions, which with only four years in the Colombian legal market, has become a benchmark for this type of transactions. Mendoza has been characterized by its modern approach and out-of-the-box thinking towards new challenges in the Colombian and international market, as well as its focus on highly sophisticated transactions with complex structures, such as the present transaction.

The exponential growth of Holding RappiPay in recent times has allowed thousands of Colombians to access their first credit card promoting financial inclusion in the Colombian market. This is why this financial facility represents a great achievement for Holding RappiPay, since it will allow it to continue providing its services to a greater number of people and thus continue growing as a company.

Undoubtedly, this operation represented great challenges at a commercial, legal and financial level, not only because of the importance of the company and its shareholders, but for the complexity of the structure and the huge amount of the facility. Considering Rappipay’s needs, which has recently obtained its authorization as a financial company, the structure of the transaction ensures the possibility for Rappipay to assign all its operation to the financial company. This implied significant challenges regarding financial regulation matters, such as the possibility for banks to lend other financial institutions to finance its operations. Additionally, the transaction used a master trust, which serves as a channel for resources, which will later be segregate and use to pay the debt service of several Rappipay’s funding transactions. This mechanism allows RappiPay, a company which certainly will continue to grow, a greater ease of negotiation in future financings.

This transaction entailed a great event in the market, since it was carried out within the international uncertainty originated by the war in Ukraine, the increases in inflation and interest rates and the change of national government, among others. This led to significant challenges in negotiating the commercial and legal aspects of this operation and evidence haw teamwork and considering all parties needs are the most important matters to achieve commercial agreements that benefit all parties position.