Cassava keeps focus on digital transformation

ZIMBABWE’S financial technology firm, Cassava Smartech says it will continue focusing on identifying and developing opportunities that are consistent with providing digital solutions to dynamic market demands without compromising customer experience.

In trading update for the 3rd quarter ended November 30, 2020, the Zimbabwe Stock Exchange-listed company said the drive towards digital transformation for improved efficiencies and enhanced revenue generation remains its goal.

“The company continues to focus on identifying and developing opportunities in the market that are consistent with providing convenient digital solutions to the changing customer demands without compromising service excellence.

“The stable macro-economic outlook, and a promising agricultural season are all pointing to a brighter and stronger finish to the financial year,” it said.

Cassava indicated that the quarter under review saw a slow-down in the downward trend of the business environment the economy had witnessed over the previous quarters, anchored on exchange rate and price stability.

The relaxation of Covid-19 lockdown conditions locally and across the world also saw relatively increased activity across most sectors of business, it said.

“After experiencing a period of relative stability in respect of new Covid-19 cases, the country has started experiencing an increase in new and active cases and this is a cause for concern.

“As a business, we are committed to continuing engagements with our key stakeholders as we educate the public and continue with the various initiatives which we put in place at the onset of the pandemic.

“We are confident that the lessons we learnt from the first wave of the pandemic will assist us to better respond to the impact of this second wave,” said the company.

During the period under review, Cassava said its business performance showed some improvement when compared to what was witnessed in the first and second quarters.

The firm anticipates that if the economy continues on such a positive trajectory into the fourth quarter, all of its business units would register recovery.

During the period under review, Cassava’s mobile money service business unit, EcoCash registered a 29 percent growth in revenue from the second quarter.

It attributed this to tariff review which became effective in August 2020 but whose full impact was felt in the third quarter.

“Active subscribers, however, declined by six percent between Q2 and Q3.

“The company also launched a self-registration USSD platform, which has seen a significant uptake in the number of new customer subscriptions.

“We remain positive about a sustained volume and value recovery in the 4th quarter,” said the financial technology company.

Turning to its banking services, Cassava said a marked improvement has also been registered in the third quarter, to exit at 81 percent revenue growth compared to the second quarter.

“This was primarily underpinned by a 166 percent growth in interest earning assets from Q2, as a result of the bank adopting a more aggressive lending strategy targeted at quality borrowers in line with the bank’s credit risk management framework.

“Mobile banking customers recorded a five percent growth in Q3, a reflection of a comeback in consumer activity. Revenue for the firm’s Insurtech business grew 131 percent compared to Q2.

“The above growth was on the back of strong growth in the short-term insurance business which registered a 165 percent increase on Q2 revenues and the company’s high-end comprehensive and diverse product portfolio which spans across all industry segments, with a specific focus on agriculture.”

Reflecting this, in the recent publication by the Insurance and Pensions Commission (IPEC), the company was placed in the top 10 insurers in Zimbabwe, which is strong recognition for a new entrant that has been in operation in the insurance industry for only two years.

The life business recorded a decline in terms of policies underwritten following the suspension of some EcoCash services for premium payments by community groups.

“The business is in the process of redesigning payment gateways to ensure all our customers have access to the flexible payment options that existed before the suspension of the previous modes of payment.

“The new transaction limits on EcoCash also affected invoices greater than Z$5 000,” it said.

The other segments of the business, comprising Agritech, Healthtech and On-Demand-Services, also contributed towards the growth registered in the third quarter.-chronicle.cl.zw