CFSL - Annual report 2018

Cim Finance Ltd now has a base of 63,291 credit card accounts in issue in Mauritius. Cim Finance Ltd has a market share in Mauritius of approximately 20% for both the number of cards in issue as well as the value of outstanding balances. The majority of Cim Finance cards in issue are to its core mass-market customer base, therefore market share of issuing turnover is lower at approximately 5-10%. Card issuing is Cim Finance’s only revolving credit product and the platform for our highest risk-adjusted margin lending business. We believe that enhancing our payments capabilities and proposition is essential to compete in the Mauritian market going forward, especially with the advent of the National Payment Switch (NPS). The Cards & Payments team is actively engaging with the Bank of Mauritius on the implications of the National Payments System Act that was passed in Parliament on 21 November 2018 to ensure that as a company Cim Finance Ltd is well positioned to take advantage of the benefits of the NPS and Instant Payment System, that are regulated by the Act. In order to enhance our cards value proposition to our clients we have decided to outsource the processing of our credit card and POS transactions to MCB Group’s subsidiary ICPS. ICPS has supportedMCB’s card business integration to the National Payment Switch, which will enable Cim Finance’s cards business to integrate seamlessly as well. We will also seek to leverage the capabilities that Cim Group’s associate investment in iVeri Payment Technologies (iVeri) can bring to support Cim Finance’s Cards & Payments business. iVeri has developed a multi- channel solution (mobile, ecommerce and POS) to offer merchants a number of options for card acceptance, but at the same time managing it on a single gateway solution. In addition, Cim Finance Ltd will be able to leverage iVeri’s full suite of POS products, which range from Africa’s first mPOS solution through to its sophisticated fully integrated multi-lane POS solution. Factoring Cim Finance Ltd was also a pioneer in Factoring in Mauritius, launching its factoring business in 2004 offering recourse factoring to its domestic customers and launching its non-recourse product in 2006. We have a new senior sales and operations team in place with a lot of experience in Factoring in the Mauritian market, as well as being certified by Factor Chain International. The Factoring team provides Cim Finance customers with solutions that help to access the working capital needed to support their business growth by: financing of up to 90% of invoice values; complete sales ledger administration and collection; as well as credit insurance cover of debtors. Cim Finance’s credit insurer is Coface, headquartered in Paris. Coface has over 4,000 employees in 100 countries. We work closely with Coface, with Coface helping Cim Finance Ltd to anticipate and evaluate the risks of debtors covered by Coface’s credit insurance so that we can make the right business decisions. We have recently installed a state of the art system from HPD called Aquarius, which is a significant enhancement from the legacy factoring system we were using. In addition to the benefits we get internally from the new system, our customers have full visibility of their factored accounts through a live interface with Aquarius via an app installed onto their mobile phone, tablet or PC. A big milestone for the team was that Cim Finance was accepted as a member of Factor Chain International (FCI), headquartered in Amsterdam, in August 2018. This will enable Cim Finance Ltd to launch import and export factoring in the near future as well as to leverage FCI’s global network of members and affiliates. There was significant growth of 30% in factoring disbursements in FY18 vs. FY17 and, with all the enhancements we have driven in the factoring business, we are looking forward to continued strong growth in FY19. Outlook As discussed in the Group CEO’s review, we have invested a lot in: our data infrastructure and analytics; enhancement of our credit scorecards; core process review and automation of select lending processes; and we also initiated a pilot digital project with our merchants. Over the next financial year, we will continue to invest in our Mauritian core businesses, in particular our consumer finance business. We will aim to continue rolling out advanced analytics off the platformof our new enterprise data warehouse; invest significantly in our core systems; as well as to digitise our customer-facing and back-office operations, leveraging the technology and capabilities we have deployed in Kenya. There is still a lot we can do to enhance the key customer journeys and experience, as well as to ensure that we improve the productivity and efficiency of our operations. 21 CIM FINANCIAL SERVICES LTD ANNUAL REPORT 2018