BNN Technology announces new Chinese partnership

The AIM-traded firm said the agreement accelerated BNN's business-to-consumer technology platform offering in the Chinese mobile payments space, both within the existing Xinhua Mobile News App channel and through local government apps.

Local government services in China were, at present, provided and paid for almost exclusively offline at physical outlets, the company explained.

It said each of the approximately 2,800 local counties and cities in the country's 31 provinces had separate local government departments responsible not only for municipal services, but also for controlling local utilities, car penalties and fines, licence applications, local taxes and key personal data relating to residents.

At present, Chinese citizens in rural China needed to physically visit each respective local government department or its designated affiliate to access or pay for municipal services, which was time consuming and highly inefficient for both users and local governments.

Local authorities were now seeking to make those offline activities more accessible through mobile apps, and the group's technology platform would provide this functionality and the interfaces between citizens, payment providers, local government departments and their commercial partners.

BNN Technology said the local apps had the potential to become a material new sales channel for the company's technology platform, given the anticipated demand for access to local government services and information via mobile, and therefore also to generate substantial volumes of data.

The group would provide its services on an outsourced basis, and would provide working capital, in return for a share of profits from the local app.

It said it had committed to invest up to RMB 13m (£1.4m) by way of a loan, and would also carry its own costs in terms of staff and hardware deployed on the project.

The group will gain access to data on users of the Local Apps, which would create opportunities to sell other products and services to the users, such as the motorist services platform announced 9 March, a student recruitment platform and credit services reporting platform.

“This key and exciting partnership presents an important additional sales channel for the group, and also presents an opportunity to provide Chinese citizens with easy access to essential everyday services at the local level,” said chief executive Darren Mercer.

“New interfaces, combined with new services, some of which will be exclusive, a larger audience and higher quality and completeness of data, will enable us to expedite the rollout of our higher margin B2C offering.

“The local government channel broadens the reach of our existing platforms and will add significant value to the student and credit services reporting initiatives currently being developed by the board, whilst positioning us as a high-quality technology provider to local governments and their commercial partners.”