A digital identity software firm has is borrowing £5m to develop mobile security applications following a tough six months of trading

Intercede Group aims to build relationships with the likes of Intel, Microsoft, and Citrix by establishing a cloud-based service.

The Lutterworth-based company will also use the cash to "support main areas of selective investment".

Funding was conditionally raised through the issue of convertible loan notes worth £4.49m, which are convertible at 68.8p and a subscription for up to 877,192 ordinary shares of 1p at a price of 57p.

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It has arrived after the group reported a 49 per cent dip in revenue in the six months to September 30 last year, falling from £5.5m to £2.8m.

intercede

This was compared to a profit of £500,000 in the same period in to 2015.

Intercede chairman and chief executive Richard Parris, said: “[The reduction] should not mask the scale of the market opportunity.

"We remain confident that the deferred orders which have affected the first half of the year will soon come to fruition and the outlook for the full year is in line with expectations.

"In the more medium term, we are equally confident that the technology we have developed to build a secure bond of trust between connected people and their devices will assume more and more importance in the markets for cloud-based applications, secure mobility and the Internet of Things."

In recent years Intercede has invested heavily in smart phone and tablet software, and its MyID identity software is used by global corporations including Lockheed Martin and Boeing.

It replaces passwords with smart cards and mobile apps.