SHORT-TERM BORROWINGS FROM A THIRD PARTY

9 Months Ended

Sep. 30, 2021

SHORT-TERM BORROWINGS FROM A THIRD PARTY

SHORT-TERM BORROWINGS FROM A THIRD PARTY

10. SHORT-TERM BORROWINGS FROM A THIRD PARTY

In July 2019, Hong Kong Takung entered into HKD Loans with Friend Sourcing with interest accruing at a rate of 8% per annum. The HKD Loans are to provide Hong Kong Takung with sufficient HKD currency to meet its working capital requirements. Friend Sourcing is a non-related party to the Company. On April 1, 2021, Hong Kong Takung extended the due date of the HKD Loans with Friend Sourcing to July 30, 2021. On August 1, 2021, Hong Kong Takung further extended the financing with Friend Souring to April 1, 2022. An interest payable, $86,823, was accrued upon extension and was paid on October 22, 2021.

In the meantime, Tianjin Takung entered interest-free RMB Loans with another third party as a guarantee for the HKD Loans. The loan amount was $2,172,766 (RMB 14,000,000). Through an understanding between the two third parties, the HKD Loans are “secured” by the RMB Loans. It is an understanding between the parties that when the HKD Loans are repaid, the RMB Loans will be repaid at the same time. On August 1, 2021, Tianjin Takung further extended the financing with the third party to April 1, 2022.

			September 30,		December 31,		Annual
			2021		2020		Interest		Repayment
Date	Borrower	Lender	(USD)		(USD)		Rate		Due Date
7/18/2019	Hong Kong Takung	Friend Sourcing Ltd.	$	715,213	$	718,127	6~8	%	4/1/2022
8/29/2019	Hong Kong Takung	Friend Sourcing Ltd.	$	696,595	$	699,434	6~8	%	4/1/2022
9/20/2019	Hong Kong Takung	Friend Sourcing Ltd.	$	557,276	$	559,548	6~8	%	4/1/2022
		Less: Discount loan payable	$	—	$	—
		Total	$	1,969,084	$	1,977,109

The weighted average interest rate of outstanding short-term borrowings was 8% per annum as of September 30, 2021. The fair value of the short-term borrowings approximates their carrying amounts.