Source: Fintech businesses increase EcoCash Holdings revenue 26pc | Herald (Business)
Business Reporter
Ecocash Holdings revenue for the year ended February 28, 2022 increased 26 percent to $29,9 billion compared to prior year’s $23,7 billion with the Fintech businesses remaining the largest contributor to the topline.
The group’s chairperson, Mrs Sherree Shereni, said in a statement of the financials that management will continue to adapt business units’ operating models to both grow and diversify sources of revenue.
“The group is optimistic about the future and will drive financial inclusion by leveraging the power of our digital platforms and partnerships.
“Our diversified group will continue to produce cutting-edge inclusive solutions and will expand our fintech solutions to agriculture, education, healthcare, and financial services, through the adoption of artificial intelligence (AI), big data, blockchain, and machine learning,” she said.
According to the financials, the fintech businesses contribution to revenue was 80 percent from 77 percent in 2021 while the insurtech business was at 14 percent, a slight decrease from the prior year’s 15 percent, and Vaya Technologies closed the year at a contribution of 6 percent.
Mrs Shereni noted that the group’s EBITDA margin improvement from 15 percent to 18 percent was a result of the relentless focus on cost optimization.
“The group will remain focused on revenue growth, operational efficiencies, and optimization of the balance sheet.
“During the year, 22 percent of the debenture holders exercised their option to redeem their debentures early in line with our balance sheet optimization strategy,” she said.
She highlighted that foreign currency exchange losses reduced from $6.3 billion in 2021 to $1.2 billion during the current year.
In terms of operations, Mrs Shereni said that product innovation remained a key priority and has allowed the group to provide relevant digital solutions that address consumer needs.
She said that with the continued support of stakeholders, the group launched several exciting products and solutions that include the automation of merchant settlements, self-care portal for EcoCash reset pin-reset, MARS laboratory tests for Covid-19, Vaya Services Fuel Monitoring, Vaya Smart Security, and improved KaShagi digital loans.
“To drive our digital banking model, Steward Bank successfully deployed a new core banking system with enhanced features.
“Leveraging on the upgrade, our Square banking App was also upgraded as well as the online banking offer,” she said.
Shereni also indicated that the bank also complied with the minimum capital requirement set by the regulator within the set timeline of 31 December 2021.
She said that due to the group’s drive towards a superior customer experience and service culture it invested continuously in products and services designed to bring convenience, especially during the Covid-19 lockdowns and restrictions.
FBC Securities in its earnings flash review of EcoCash Holdings said while the mobile money unit remains the group’s highest revenue earner, the highly regulated nature of the business may be a limiting factor to the unit’s revenue-generating capacity.
“We believe management’s ability to grow its other revenue streams will be a key consideration in the business’s continued success,” it said.
The equities research and investment company said the business remains a well-diversified leader in fintech solutions and has highlighted continuous plans to produce cutting-edge inclusive solutions.
It said the business plans to expand fintech solutions to agriculture, education, healthcare, and financial services, key sectors in the local economy, through the adoption of artificial intelligence (AI), big data, blockchain, and machine learning.
“We believe the Group is well positioned for growth going forward in line with international fintech trends,” said FBC Securities.