Aust payment processing & funds settlement update ISXPay
- Actual October - January operations indicate 'annualised' Gross Process Transaction Value (GPTV) will be in excess of $100m across first 3 merchants
- Previous November forecast : GPTV expected in excess of $75m across 7 merchants
- Actual Net Margin is tracking at 138bps, versus November forecast 92bps.
Card Acquiring: Payment Processing & Funds Settlement Services
Our last update date 28/11/2017 anticipated that the total card acquiring 'book' value would be in excess of $75m per annum of Gross Processed Transaction Value (GPTV) to be settled by ISXPay directly to the merchant's bank account. The Company also forecast an average net margin of 0.92% on the Merchant Services Fee (MSF), for provision of card acquiring / payment facilitation & settlement services, which would be applicable across the total contracted GPTV.
Over the last four months, actual figures indicate that GPTV will exceed $100m annualised, based on just 3 of the 7 merchants contracted. The Company cannot at this stage forecast the GPTV contribution of the other contracted merchants or those being finalised to contract.
The net MSF margin for this particular sector in which the merchants operate in, is in excess of 1.28% applied on the GPTV. The Company expects the net MSF will average down to around 1.15%, as the Company diversifies its operations across various unrelated merchant market sectors whilst also increasing in GPTV volume. Transactional (flat) fees charged are at a weighted average of 24c/Transaction and are in accordance with previous forecasts.
The Company has elected to focus on selected merchants as they provided scale, and a higher gross margin than the anticipated average. This has allowed the company to bed down its technology and operations, before moving to conclude further integrations, process higher volumes, and finalise further new sales opportunities.
Further merchants are expected to go live within the next few weeks, and will include the full Paydentity(TM) suite. For AML regulated merchants, the use of Paydentity will likely translate to higher KYC conversions together with massive increase in extraterritorial reach, which in turn will likely lead to corresponding increase in GPTV being processed by ISXPay(R).
The Company will no longer announce merchants by name, but will report based on sector / actual results, in order to preserve merchant confidentiality and Company's commercial positioning.
National Australia Bank Agreement (ASX:NAB)
The Company announced on the 8th August 2016 an agreement with the National Australia Bank, whereby daily cashflow for card settlement is provided by the NAB at a wholesale rate to the Company. This allows the Company to pursue merchants of all sizes, as the NAB agreement ensures that the Company has adequate daily cashflow to effect settlement.
About iSignthis Ltd
iSignthis Ltd (ASX:ISX) (FRA:TA8) is a hybrid monetary financial institution and also a RegTech leader in remote identity verification, payment authentication with deposit taking, transactional banking and payment processing capability. iSignthis provides an end-to-end on-boarding service for merchants, with a unified payment, electronic money and identity service via our Paydentity(TM) and ISXPay(R) solutions.
By converging payments and identity, iSignthis delivers regulatory compliance to an enhanced customer due diligence standard, offering global reach to any of the world's 4.2Bn 'bank verified' card or account holders, that can be remotely on-boarded to meet the Customer Due Diligence requirements of AML regulated merchants in as little as 3 to 5 minutes. Paydentity(TM) has now onboarded and verified more than 1.5m persons to an AML KYC standard.
iSignthis Paydentity(TM) service is the trusted back office solution for regulated entities, allowing merchants to stay ahead of the regulatory curve, and focus on growing their core business. iSignthis' subsidiary, iSignthis eMoney Ltd, trades as ISXPay(R), and is an EEA authorised eMoney Monetary Financial Institution, offering card acquiring in the EEA, and Australia.
ISXPay(R) is a principal member of Mastercard Inc, Diners, Discover, (China) Union Pay International and JCB International, an American Express aggregator, and provides merchants with access to payments via alternative methods including SEPA, Poli Payments, Sofort, PRZ24 and others.
Probanx Solutions Ltd, a wholly owned subsidiary of iSignthis Ltd, provides API based access to CORE Banking solutions, SEPA Core, SEPA Instant and SEPA business scheme, for neobanks, banks, credit unions and emoney institutions, and provides a bridge to the Eurosystem's Central Bank of Lithuania's CENTROLink service.
National Australia Bank Limited