Digital services firm, Ecocash Holdings says its revenue for the first quarter to May 2022 were severely hit by exchange losses from the weakening exchange rate which resulted in the depreciation of the local currency by 172 percent.
The technology company requires substantial amounts of foreign currency for its operations at a time there is limited supply from the RBZ auction. The depreciation of the local currency means companies incur huge losses when converting their local currency balances into the USD.
In its Q1 trading update, the group its witnessed a modest increase of 2 percent in volumes compared to the previous quarter driven by the FinTech business segment which remains the highest contributor to revenues.
“Management continues to adapt business units’ operating models to both grow and diversify sources of revenue. During the period under review, significant exchange losses were recorded due to the weakening exchange rate with the local currency depreciating by 172%,” the company said.
Growth of 38 percent was witnessed on wallet funding as customers continue to prefer mobile transactions over other payment platforms.
The mobile money business also saw a 3 percent growth in transaction volumes when compared to the prior quarter due to an increase in customer activity.
“The mobile money business is expected to continuously improve its performance going forward driven by new innovations, product bundling within the Group and promotions to drive mobile payments.”
Steward Bank’s interest-earning assets portfolio grew by 3 percent from the last quarter on the back of an increase in underlying business and customer deposits.
In the first quarter, the Bank launched the Foreign Currency Account (FCA) on Square, an innovation that digitizes all FCA related transactions on Mobile App, allowing customers to transact through their phones.
The Life business broadened its service offering on the *900# platform in response to customer feedback and as part of our promise to enhance the bouquet of packages that Ecosure offers.
The number of addons options to the core product on the *900# platform increased to ten. The add-ons are being managed within the approved risk appetite limits. The Life business has started offering USD denominated products in the period under review and there is a steady growth of 3 percent on the uptake.
Vaya Technologies’ growth continued to be anchored on the HealthTech business as demand for health services continues to be high. The HealthTech products are also being bundled with other group products as part of the Group growth strategy. Over 100,000 customers have been onboarded onto the MARS-EcoCash capitation model.
