FIRSTCRED LIMITED Conden Audited Financial Statements

For The Year Ended 31 December 2020

achieved in December 2020 remained relatively stable compared to 2019 despite reduced demand in loans because of the current economic challenges.

The acquisition of Finclusion Africa Holdings Limited, which was consolidated in the Group ‘s results for the first time on 31 December 2020, increased the Group ‘s asset base from P271M in December 2019 to P 521M in December 2020. The Group ‘s loan book stood at P277M in December 2020 in comparison to P160M achieved in December 2019, the significant growth driven by acquisition of Finclusion. The Group’s impairment to loan book ratio increased to 14% in December 2020 from 11% in December 2019 and the Group has reviewed its loan products with sub-par collection rates of below 98% to manage loan book quality.

The Group’s other financial borrowings stood at P311M; this indicates the Group ‘s ability to continually leverage from debt to fund loanbook growth. The Group will continue to improve the cost and tenure of its borrowings to benefit through renegotiation of its existing borrowings as well as refinancing of high cost of some debt facilities.

Directorate and Executive

The Board would like to advise of the resignation of Mr. Jeffrey Sibisibi who was also the chairman of the board on 28 February 2020. Furthermore, Mr Dirk Petrus Van Der Merwe and Mr Marshal Chimedza resigned from the Group board on 22 May 2020 and 23 July 2020, respectively. The board would like to take this opportunity to extend gratitude their year of service to the group and wish them well in their future endeavours.

Mrs. Masego Marobela was duly appointed as the chairman of the constituted board of the Group. The group looks forward to strong leadership underpinned by strong corporate governance from this board. The Group would like to welcome Mr. Paul Ramokgalo as Non-executive Director, Mr. Paul Soko as Finance Director and Mr. Ambrose Batsalelwang to the role of Chief Operating Officer subject to regulatory approval.

Outlook

The strategic objective of FirstCred is to retain and grow its market share throughout sub-Saharan Africa through a sustainable business model that offers competitive interest rates, an evolving and innovative product suite supported by technology, while managing its cost of funding. FirstCred will continue to utilise technology to support the quality and speed of its service delivery, in addition to expanding on its agent banking platform.

The current economic environment which has been significantly affected by Covid 19 has also presented opportunities in transformation through technology, the group continues to exploit the available resources to deliver a customer centric and quick credit decisions and loan disbursements.

The group in its effort to reposition in its operations after takeover by MHMK Group limited rebranded to FirstCred Limited in 2020 from Getbucks Limited. The Group continues to grow its operational footprint, and it is expected that the portfolio will evolve into deposit taking banking institutions across all operations, alongside the introduction of various innovative online platforms and products, to further increase the group’s ability to provide accessible financial services to all.

The Group has applied to the relevant regulatory authorities in countries of operation not yet offering this product, to expand its lending to SMEs which will allow the Company to increase its offering and continue to drive financial inclusion.

The group received an approval of its P1 billion guaranteed medium term note programme from the Botswana Stock Exchange Listings and Trading Executive Committee on 14 May 2021. The proceeds of the note programme will be used for regional expansion, as operating capital for general corporate purposes to aggressively grow the loan book through its lending operations, and lastly, to re-finance and/or retire the existing external debt to allow Group to lower its cost of funding and/or reduce the cost of capital.

For and on behalf of the Board of Directors .................................... M. Marobela Chairman