The Board of Directors of the Company (the “Board”) is pleased to provide the following trading statement and update on recent developments.
The payments division continues to make progress in all areas, but particularly in non-card payments. EURO IBAN account openings increased a further 16% to the 21 February and growth of GBP accounts was in excess of 700%, however this is from a low base as this service only commenced during January; the Board will be able to present more meaningful data in the coming months as take-up numbers grow. Transaction volumes are also steadily increasing across our non-card payment services.
In card payment services, improvements in KYC approval process and card distribution has seen an increase of 80% in transaction volumes, with the extended target for 20,000 cards to be delivered and activated remains unchanged (30 April 2020).
Technology developments enabling connectivity between accounts, cards and e-wallet balances are fully implemented, giving clients improved services plus FX capabilities between GBP and other currencies on demand.
Our merchant services continue in an evaluation phase relating to the upgraded payment gateway and fraud prevention software released in January. The merchant services team have begun the merchant approval process with a broad pipeline of suitable candidates having applied for services from a range of medium to high-risk industries.
As previously announced the number of Lottery lines played on a weekly basis continues to grow. The overall number of lines played is approximately 33% higher in February 2020 than for February 2019. This growth has kept the Lottery Business on target to make a positive operating contribution to the Group for the second half of the year to 31 January 2020.
Working capital remains constrained and an area of focus, however the Board believes the improving operating performance will alleviate the position gradually. The completion of the subscription for new shares and capitalisation of existing liabilities (as announced on 31 January 2020), that is subject to shareholder approval at the general meeting to be held later today, will assist substantially with the working capital position.
Chief Executive Graeme Paton commented, “We continue to progress on our plan of delivering full-service, banking-style capabilities, with the added flexibility that FinTech operators can provide. This progress is reflected across the business, especially with our “Banking As A Service” offer now that GBP is up and running properly in addition to EUR. In fact our unique suite of GBP and EURO accounts, connected to prepaid cards, which are proper IBANs in EURO as well as standard format GBP accounts for qualifying businesses, as well as individuals with FX services coming on stream and USD accounts plus other currencies, will shortly mean we can offer a real alternative to traditional payment companies – servicing e-commerce, traditional businesses and individuals alike.”