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Fawry considers entering field of IPO payment in EGX offerings through company's outlets next year - Daily News Egypt

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Fawry considers entering field of IPO payment in EGX offerings through company’s outlets next year

We have achieved great success in funding traders who previously contracted with Fawry, we plan to expand this: Okasha


Managing Director of Fawry Payment Services, Mohammed Okasha, has reviewed the company’s expansions in the coming period. He also presented his vision of the future of the non-monetary services sector and the digital transformation, in addition to opportunities this transformation offers the company. Daily News Egypt interviewed Okasha to find out more, the transcript for which is below, lightly edited for clarity:

How do you see the future of ePay services as the country moves toward digital transformation and obliges companies in non-banking financial sectors to use non-cash payment methods in their financial transactions?
The future is still great for the growth of electronic payment services, especially with the implementation of the state strategy for digital transformation and obliging companies operating in non-bank financial activities to use non-cash payment methods, which would add a wide range of different financial sectors to transform toward non-cash transactions through companies providing these services, such as Fawry. It is expected to attract a segment of mortgage finance, financial leasing companies, factoring companies, microfinance companies, and any non-banking financial body.

What are the new sectors that the company intends to enter into during the coming period?
The company intends to enter the field of Egyptian Exchange (EGX) during the coming year by providing the possibility of paying initial public offerings (IPOs) through Fawry outlets. However the current market conditions, the low volumes of trading and the reluctance of companies to register at the EGX makes Fawry wait for trading and offerings to recover next year to launch the service.
The company is also investing heavily in the technological infrastructure that enables it to maintain in its competitive position, and it is also betting on many services such as mobile payment services, which are expected to develop well in the coming period.

What new services are prepared by Fawry for immediate release?
The new services that the company intends to offer in early August is to make the status of orders of goods available through Fawry, making the registration of orders electronically through the company “Fawry FMCG” for sale, easy. Three months ago, the company started being active. The company has also contracted with P&G and Unilver to carry out experiments on the new service.
Fawry FMCG allows e-payment for merchants to purchase consumer goods, as well as lending traders who deal with Fawry. These loans should be used for electronic payments to pay for consumer products purchased by merchants such as Chipsy, Coca Cola, Juhayna, and other companies. This came after we recently obtained the microfinance license from the FRA, to be used for the purpose of paying the value of traders’ purchases electronically rather than lending. The balance of financing remains in the trader’s account for use in e-payment operations.
We have achieved great success in a very small time in terms of financing small traders and the company is seeing a high demand on these facilities, which the company intends to expand and provide to all traders who contracted with the company.
We are always looking for everything that offers an added value and new opportunities in related fields, which requires investing in companies that provide excellent solutions for the complementary services of Fawry. The company has made several successful investments such as investing in companies like “Waffarha” , “Tazkara” and “Bosta”, in parallel with government services that the company succeeded in attracting and increasing over the coming period.

What is the target volume for traders who contract with Fawry by the end of 2019?
Fawry targets 125,000 traders (with active transactions) by the end of this year compared to 104,000 contractors currently with the company. There would also be regional expansions in the UAE, Saudi Arabia, and Kuwait, which would increase the volume of Fawry’s contracts, which would specifically be clear next year with the implementation of a strategy to oblige companies in the financial non-banking sector to use non-cash methods in their transactions.

What are the most prominent concerns that may hinder the growth of the e-services sector?
I see that the most important challenges that must be addressed to reach the digital transformation and deepen the electronic payment market is dealing with the reluctance of many important government agencies to deal with electronic payment services. These bodies include the Tax Authority and the Land Registry Authority, in addition to many other bodies. There is a strong need for changing the work culture of these entities in addition to raising awareness on the importance of these services in the development of the governmental work system.

What is the volume of Fawry’s business and its most prominent clients?
The volume of the company’s transactions increased by three time during the past period especially as Fawry dealt with many ministries and government sectors, as well as the private sector, which was faster and easier in terms its response to electronic payment services, unlike the government, which hesitated to enter the field, but with the establishment of the National Payments Council, the entry of the government sector into e-payment services happened at a much faster pace.
Currently, Fawry deals with almost all ministries, such as the ministry of culture, in the booking of opera tickets, the ministry of interior in the process of paying fines, and the ministry of housing in paying instalments of housing units, in addition to the ministry of justice and the ministry of electricity.
Fawry is also the only company in Egypt that is connected with all the banks through electronic payment and is the only company to provide the mobile wallet service of banks, as well as making payments using cards in Fawry machines that are available in the market.

What are the latest developments in the company’s IPO plan?
Currently, there are comparisons between investment banks that will be managing the offering. These banks are being addressed and the perfect timing for the offering is being discussed based on the market circumstances, as the main purpose of the registration process is availability and allowing shareholding of the company for a wider segment of clients. The offering will be available for individuals. Regarding offering with the purpose of funding, it is very easy for the company to provide funding through funds and strategic investors.

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https://ww.dailynewssegypt.com/2019/06/17/fawry-considers-entering-field-of-ipo-payment-in-egx-offerings-through-companys-outlets-next-year/
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