EcoCash decries unfavourable economic conditions
DESPITE efforts to push the digital transformation agenda and financial inclusion, the obtaining unfavourable economic conditions are likely to weigh on EcoCash Holdings’ business, according to analysts’ projections.
The group has indicated several initiatives aimed at fostering the digitalisation mantra, which has been topical across the globe and spurred by the Covid-19 pandemic.
This also comes as the fintech group is on course to further pursue opportunities in the market for social and financial inclusion through technology with plans to contribute towards sustained innovations in the Fintech, Insurtech, Healthtech, Agritech and On Demand Services space.
“Ecocash continues to focus on improving financial inclusion and will carry on with investments in digital transformation and leveraging on smart technologies.
“The group’s continued innovation and introduction of new products and services indicates potential to grow its revenue,” said brokerage firm IH Securities.
However, just like any other firms operating in a challenging environment characterised by economic uncertainties, EcoCash’s operations will also be adversely impacted.
Already, in the mobile money segment transaction volumes at the national level have maintained a downward trend, going from 50,03 million in March to 42,65 million in August, pointing to likely sustained pressure on operations within the group’s FinTech unit.
“With expected constrained consumer liquidity due to the negative impact of the El Nino phenomenon on the agricultural sector, this trajectory will likely sustain.
“We expect that increased competition in the US dollar mobile transfer space will exert pressure on the business’ strategy to diversify earnings,” said IH Securities.
During the first quarter of 2024, EcoCash successfully raised the US$30,3 million required to redeem its debentures following a Rights Offer. This is expected to eliminate exchange losses arising from debenture-related liabilities, which will have a positive impact on the bottom line.
The listed fintech firm has maintained its focus on bolstering financial inclusion and digitalisation.
During the half year period to August 31, 2023, the group continued its nationwide expansion within the mobile money sector and introduced a range of products and services aimed at addressing customer needs.
These include increasing the number of merchants accepting EcoCash US dollar payments in a deliberate move to increase forex revenue. This is in addition to re-launching the EcoCash Express Debit Card, which is linked to customers’ EcoCash US dollar accounts, allowing them to swipe, withdraw cash, or transact at any MasterCard terminal or ATM.
Steward Bank also saw further digitisation during the period through the adoption of new technologies. The bank rolled out a Digital Agent Banking Portal that automates banking services offered by its agents to increase accessibility to these services, in addition to Q-Not, a digital account opening platform enabling customers to open full KYC accounts remotely.
Another initiative carried out in the past financial year to boost its business and subscriber base include the launch of an artificial intelligence (AI) powered chatbot — a virtual assistant that handles customer service queries.
By the end of the year, this AI powered virtual assistant had provided services to over 381,000 customers.
“We also launched Bill Manager, an integrated bill payments platform for all major billers. Bill Manager has helped to improve our customers’ experience and real time account settlement to regular billers through EcoCash.
“We have integrated with local municipalities, insurance players for premium collections, universities, credit stores, retailers and utilities,” said the group.