Company: IPSI
Filing Date: 2025-03-31
Form Type: 10-K
Source: 0001213900-25-026455
Chunk: 661

Company: Innovative Payment Solutions, Inc.
Filing Date: 2025-03-31
Form: 10-K
Item: Item 2
Chunk 661
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,778 of promissory note funding during the current
year for working capital purposes.

Interest income

Interest income was
$32,838 and $0 for the years ended December 31, 2024 and 2023, respectively, an increase of $32,838 or 100.0%. The interest income relates
to funds advanced to Business Warrior prior to the cessation of our merger plans with them.

25

Amortization of
debt discount

Amortization of debt discount was $1,037,914 and $770,372 for the
years ended December 31, 2024 and 2023, respectively, an increase of $267,542 or 34.7%. The increase is primarily due to the amortization
of debt discount on convertible notes carried over from the prior year and additional debt discount on new convertible notes issued during
the current year to fund working capital.

Derivative liability
movements

Derivative liability
movements were $6,892,395 and $1,501,446 for the years ended December 31, 2024 and 2023, respectively, an increase of $5,390,949 or 359.1%.
The derivative liability arose primarily due to the revaluation of certain repriced conversion features on convertible notes and the
reset of the exercise price and full ratchet reset of certain warrants during the current year, and the subsequent mark-to-market of
these derivatives due to a declining stock price on the exercise of certain convertible notes during the current year.

Operating loss
from equity method investment

Net loss from equity
method investment was $819 and $403,282 for the years ended December 31, 2024 and 2023, respectively, a decrease of $402,463 or 99.8%.
The loss in the prior year related is due to the dilutive effect of withdrawals of cash out of the joint venture by the other joint venture
parties, impacting on the overall value of the. IPSIPay Express Joint venture attributes to the Company.

Impairment of
equity method investments

Impairment of equity
method investments was $705,142 and $0 for the years ended December 31, 2024 and 2023, respectively, an increase of $705,142 or 100.0%.
The equity method investment was impaired due to uncertainty as to when, the joint venture will begin generating revenues and the certainty
of future business prospects at this time.