UAE's Al Ansari in profit drop as remittance scene gets more competitive

Dubai: The operator of the currency exchange house, Al Ansari Financial Services has seen net profits drop to Dh405.8 million from Dh495.18 million as the remittance business turns extra competitive.

Income for the DFM-listed company came to Dh1.18 billion from Dh1.16 billion, with Al Ansari looking to develop its presence outside of the UAE too.

While remittance volumes continue to grow, with expat residents making gains from a dollar surge, the number of platforms that offer opportunities to send money keeps growing.

"We have been working closely with regulatory authorities to address industry challenges, particularly the disruptive practices of certain fintechs that undermine fair competition and create an uneven playing field for all industry participants," said Rashed Al Ansari, Group CEO of Al Financial Services.

"Our proactive stance in this area underscores our commitment to fostering a balanced and equitable market environment."

Fintechs are aggressively courting expats on their currency remittance needs through targeted promotions, including zero fee transactions. This year will further see market shares held by currency exchange houses, banks and fintechs turn even more fluid.

"By now, most UAE residents will have 3-4 options at hand to decide which one to use for money transfer," said a market analyst. "Sticking to any one channel or service provider is increasingly difficult.

"There is a pushback if customers see there is a higher fee involved."

The Al Ansari stock is at Dh0.98 against the Dh1.03 IPO price.

If all goes to plan, Al Ansari will finally launch its own digital wallet in Q1-2025. This is currently awaiting approval from the UAE Central Bank. When this comes out, the company will be hoping to gain a decent share of the market for fast-growing digital payments space in the country.

"Despite navigating a challenging environment marked by economic and geopolitical pressures, intense fintech competition, rising corporate taxes, and increased operational costs, we concluded the year with a net profit of Dh406 million and an EBITDA margin of 44.4%," said Al Ansari.

"These results affirm the robustness of our strategy and vision."