TBC Bank Acquires Uzbek Fintech Company Payme
TBC Bank Group PLC (TBC Bank) has agreed to acquire over 51% of “Payme”, an Uzbek payment service provider, thus entering into the financial services market in Uzbekistan.
The transaction, signed in April, will increase TBC’s customer base by 50% as Payme currently has 1.3 million people using their products. TBC agreed to pay $5.5 million for Payme, suggesting Payme is valued at around $10.8 billion.
“The purchase of Payme is another important step taken in Uzbekistan’s planned expansion,” said Vakhtang Butskrikidze, General Director of TBC. “This will enable us to get direct access to a large number of consumers by using our digital power to make some innovations in the Uzbek market.”
Payme provides payment solutions for its customers in Uzbekistan, for example by enabling P2P transfers, loan repayments, utility payments, mPOS for QR-based payments and e-commerce transactions. It also enables customers to purchase loans from some Uzbek banks.
Having increased their number of customers by 70% in 2018, Payme has demonstrated the potential Fintech has in the region. In 2018, the company’s revenue and net income also grew year-on-year by 41.9% and 24.5% respectively. By the end of the year, Payme reported $1.6 million total revenue and $800,000 profit before tax.
TBC bank’s acquisition of Payme aligns with its international strategy to expand within the region. With a population of 32 million, Uzbekistan is an attractive market with good business promise.
In the past, Islam Karimov, who ruled Uzbekistan from 1991 to 2016, had allowed Uzbekistan’s economy to stagnate through its Soviet-era command economy. However, since Shavkat Mirziyoyev came to power in 2016, he has shown some willingness to reform and diversify the economy. Despite Uzbekistan’s reliance on oil, natural gas, and gold, the economy has been steadily growing, with retail lending ration at 7.2% of the GDP at the end of 2018.
Through its acquisition of Payme, TBC Bank aims to develop banking ecosystems for business and retail services in Uzbekistan. They are using the digital bank “space” to develop a new main banking system in the country.
“With Payme, we plan to expand the payment business and use Payme as a platform for developing a new ecosystem in the country,” said Butskrikidze. “I’m glad to be collaborating with the successful team of Payme and look forward to starting working together with our partners, in developing and implementing the strategy of the Bank in Uzbekistan.”
TBC Bank purchased part of the shares of managing owners Sarvar Ro-zmatov, Bakhrom Khodjayev and Farrukh Ziyatev, as well as business development directors Abdul-Azziz, Abdul-Akhadov and Oleg Geverges.
“We are pleased to partner with the leading bank in the region, which has developed digital capabilities and a strong interest in Uzbekistan,” said Rozmatov Sarvar Nazrulaievich, founder of Payme. “We are confident that together with our company we will move to the next stage and in the short term, we will offer our customers new, modern solutions and services.”
The current Payme team will continue to work in the company after the acquisition and will be involved in developing and executing Payme’s strategy in the future.
By Amy Jones
Image source - Wikimedia Commons