Dubai: Network International, the payments solutions company that listed its shares on London Stock Exchange in April, will focus on expanding and consolidating business in its core markets of the Middle East and Africa.
“We will continue to focus on growth opportunities in the region rather than looking at new geographies,” said Simon Haslam, Group CEO.
While maintaining a strong performance post the IPO, the company is pursuing growth in the MEA markets, which it says has huge untapped potential. Network reported a strong set of results in the first-half of 2019, with revenue and underlying EBITDA [earnings before interest, tax, depreciation and amortisation] growth of 12.4 and 13.9 per cent, respectively. It recently repriced the debt facility to a more favourable rate, which will support reduction in interest margins and profitability, going forward.
“Over the last six months, we have successfully extended contracts with some of our largest customers, deployed exciting new products and strengthened our sales and innovation pipeline,” said Haslam.
In the UAE, Network renewed contracts with two of its largest customers, Emirates NBD and Emirates Islamic. In Africa, it has a growing new business pipeline across both merchant and issuer solutions.
Network’s two main business lines — merchant and issuer solutions — have seen low double-digit revenue growth this year, as it continues to add new customers and sell additional services to their existing customer base. Haslam sees significant opportunities in Network’s largest markets such as the UAE, Egypt and Jordan, where there is a concerted effort by respective governments to increase the volume of digital payments.
The recent entry of contactless payment solution providers together with growth in eCommerce will trigger broader changes in consumer behaviour.
In the UAE, consumers are growing more comfortable with using cards for transactions, both in-store and online. According to a study by Visa and Department of Economic Development (DED), 73 per cent of online shoppers prefer paying by card driven by factors such as security, budget management, and spend rewards.
For in-store transactions, consumers cited security, convenience, and budget management as the top three drivers for card usage. The findings also noted that 82 per cent of respondents trust digital wallets and 75 per cent trust contactless cards. Going forward, Network expects cash-on-delivery rate to continue to decrease as digital payment methods gain traction.
“We are the merchant acquiring partner for Expo 2020 Dubai. The recent entry of contactless payment solution providers such as Apple Pay, Google Pay and Alipay together with the rising growth in eCommerce will help trigger broader changes in consumer behaviour,” said Haslam.
The company recently partnered one of Egypt’s leading private sector banks, ALEXBANK, to issue prepaid cards to citizens under the Egyptian National Payment Scheme (Meeza). Network anticipates significant opportunities in Africa where access to mobile technology, favourable demographics, increasing international and intra-regional trade, and adoption of increasingly affordable technologies are driving digital payment adoption.
Orabank recently signed Network for an additional seven-year period as a key partner in their ongoing digital transformation. It currently offers the bank a full suite of payment processing and acquirer processing solutions in 12 African countries.
Digital payments in the MEA markets are set to grow from 2017’s $6.5 trillion to $8.9 trillion in 2022.