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Zaim Credit Systems significantly increase online business

10:15, 2nd November 2020
Francesca Morgan
RNS Newswire
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Zaim Credit Systems (AIM:ZAIM FOLLOW) unveiled to investors that it continues to significantly advance the online business for its wholly owned subsidiary, Zaim-Express LLC. 

Following a shift to a more flexible and scalable online operation, the Russian-focused fintech group said its online operation now represents the largest segment of its business in terms of revenue. 

Zaim made a substantial investment in a convenient online platform to allow customers to receive and repay loans online or by phone in several minutes without leaving their homes. 

As a result of its continued online growth strategy, Zaim has managed to ‘significantly reduce’ the number of physical stores from 92 to 32 and redirected most customers online. 

Zaim said this represents the successful delivery and execution of a revised strategy which has since seen significant growth from a low online base at the time of its IPO last year. 

“During the last several months and accelerated by the recent pandemic related movement restrictions, Zaim has cemented its evolution from a traditional physical store-based model to a highly-flexible and scalable online-focused business,” said Siro Cicconi, Zaim's CEO. 

Zaim explained how the ongoing COVID-19 pandemic has accelerated the migration of its ‘offline to online’ business model. Since its implementation, Zaim has witnessed a positive impact on the business growth and margins due to its comparatively low fixed cost base. 

Cicconi said the group’s efforts are already showing positive results exceeding expectations since the start of the online business in Q4 2019 at the time of the company’s IPO. 

Commenting on the transition, he added, “This transformation lays the foundation for further growth and shareholder value through scalability and increased margins.” 

Given the success of its online offering, products and the rapid growth in demand that it is witnessing, the company said it is now in the process of developing a new App which it said ‘should further the user experience and increase the potential target market for Zaim.’ 

Zaim said the app is expected to proceed to a full-scale launch during the first half of 2021.  

Shares in Zaim Credit Systems have traded strongly over the past month to open 15.60% higher at 2.52p following this morning’s announcement. 

ZAIM price chart

3 Reasons to Follow Zaim Credit Systems 

Zaim Credit Systems plc is the holding company of a Russian based financial services company Zaim Express. Zaim’s core product is providing microloans to Russian consumers. 

Transition to Online 

Zaim aid its accelerating online transition and related costs savings from store closures have helped offset the impact of the COVID-19 pandemic in its half-year results for H120. 

High Growth 

The Russian-focused group said its online business has demonstrated ‘impressive growth’ to record-high levels by period end, with June demonstrating a 40% month-on-month growth.  

The group held £0.81m cash as at 30 June 2020 which it said leaves it ‘well-funded’ to continue to execute its strategy.  

Strong Post Period Update 

In a post period end trading update from its subsidiary, Zaim-Express, Zaim confirmed continued record growth with volumes of total lending approaching pre lockdown levels. 

COVID-19 related restrictions were lifted in Moscow at the beginning of June with subsequent further lifting of restrictions occurring later in July. As a result, the business has since seen positive momentum and observed ‘a continued increase in demand.’  

“We are confident that the group is going to benefit from this strategy regardless of the future development of the Covid-19 pandemic situation, as the online segment of the microfinance market is growing at an impressive rate and we have a competitive advantage via our online platform and bespoke IT system,” Cicconi told investors back in September. 

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The information, investment views and recommendations in this article are provided for general information purposes only. Nothing in this article should be construed as a solicitation to buy or sell any financial product relating to any companies under discussion or to engage in or refrain from doing so or engaging in any other transaction. Any opinions or comments are made to the best of the knowledge and belief of the writer but no responsibility is accepted for actions based on such opinions or comments. Vox Markets may receive payment from companies mentioned for enhanced profiling or publication presence. The writer may or may not hold investments in the companies under discussion.

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