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For Immediate Release
3 February 2021
Zaim Credit Systems Plc
("Zaim" or the "Group")
Fourth quarter and full year 2020 trading update
Zaim Credit Systems plc (the 'Group' or 'Zaim'), the Russian focused fintech group, announces a post period end trading update from its wholly owned subsidiary, Zaim-Express LLC, ('Zaim-Express') in respect of the fourth quarter and the full year ended 31 Dec 2020.
Fourth Quarter 2020 Highlights [1]:
· Very strong quarterly performance with impressive growth in loans issued to £3.8m, an increase of 65% compared to Q3: £2.3m
· Loans issued online grew by 250% during the quarter to £2.9m
· Online now at substantial and sustainable levels comprising 76% of business and continues to be the main engine for growth
· The Group continued to trade profitably in Q4 2020
Full Year 2020 Highlights:
· Successful transition from offline to online focused business model with a lower fixed costs base and greater flexibility
· Increase in loans issued to £10.3m representing growth of 11% vs. 2019 despite the Covid-19 lockdown and the number of physical stores being significantly reduced during the year
· Growth of loans issued online to £4.8m (2019: £0.3m)
· Decrease in loans issued offline to £5.5m (2019: £9.0m) due to closure of stores and transition to online-focused business model
· Increase in weighted average default rate for the first nine months of 2020 to 14.1% (2019: 7.6%) in line with management expectations due to greater portion of first-time clients. This is a direct result of the rapid growth of the online business.
Siro Cicconi, Zaim's CEO commented:
"Last year posed a serious challenge for all of us and I am pleased to report that it became a turning point in Zaim's transition towards a predominantly online business model. The lockdown measures taken by governments and the world-wide migration to online services accelerated this change. The board and management acted swiftly and decisively by putting the majority of the resources of the group into development of online business which is now beginning to bear fruit.
As a result of these efforts, loans issued online grew at an impressive rate during the year, from a near standing start to £2.9m in Q4 and now accounting for 76% of the Group's business. This part of the business is now very well positioned for future growth.
I am also pleased to note that the business continues to be cash-generative, which we are reinvesting in order to accelerate further growth of our online business. Our online-focused strategy allows for lower fixed costs and faster growth that makes us confident in the long-term development of our business. Our investment in our proprietary platform and process is delivering impressive results and we will be very focused on continuing to drive growth during 2021.
I would like to thank the whole team for their dedication and look forward to this positive trend continuing over the coming months."
Fourth quarter 2020 trading update
The table below presents the two main KPI's (loans issued and default rate) for the last five quarters:
| Quarter Ended | Dec-19 | March-20 | June-20 | Sept-20 | Dec-20 |
| Loans Issued (£'000) | £2,284 | £2,549 | £1,622 | £2,307 | £3,812 |
| Weighted Average Default Rate2 | 8.1% | 13.6% | 12.1% | 15.8% | See note3 |
The Group continued to see strong growth in loans issued during the quarter up 65% QoQ, driven by expansion of the online platform.
The weighted average default rate increased slightly to 15.8% in Q3 as a result of the increase in the share of first-time customers that have higher levels of default. This is in line with the management expectations, is being diligently managed and is caused by the rapid growth of online business and is not due to any deterioration of business performance.
Composition of the loan book
Loans issued in each of the months of the fourth quarter of 2020 are set out in the following table:
| Period | Loans Issued Online £'000 | Monthly Growth rate % | Loans Issued Offline £'000 | Loans Issued Total £'000 | Monthly Growth rate % |
| October | 694 | 32.1% | 324 | 1,019 | 14.1% |
| November | 860 | 23.9% | 306 | 1,166 | 14.5% |
| December | 1,334 | 55.1% | 293 | 1,628 | 39.5% |
| Total Third Quarter | 2,889 |
| 923 | 3,812 |
|
Loans issued for the financial year:
| Full Year Ended | Dec 20 | Dec 19 | Change |
| Loans Issued Online | £4.8m | £0.3m | 1,435.8% |
| Loans Issued Offline | £5.5m | £9.0m | (38.7%) |
| Total Loans Issued | £10.3m | £9.3m | 10.5% |
The Company looks forward to releasing its audit annual accounts for the year-ended 31 December 2020 in due course.
*Ends*
Follow us on Twitter - @ZaimcreditSyst
Enquiries:
| Zaim Credit Systems Plc |
|
| Simon Retter Siro Cicconi |
Tel: +44 (0) 73 9377 9849 |
| Alex Boreyko
| Tel: +7 925 708 98 16 investors@zaimcreditsystemsplc.com
|
| Beaumont Cornish Limited |
|
| Roland Cornish / James Biddle | Tel: +44 (0) 20 7628 3396 |
|
|
|
| Optiva Securities Limited |
|
| Jeremy King / Vishal Balasingham | Tel: +44 (0) 20 3137 1902 |
The information contained within this announcement is deemed by the Company to constitute inside information as stipulated under the Market Abuse Regulations (EU) No. 596/2014 ("MAR").
1 All figures presented throughout this announcement represent unaudited management information taken from the internally generated management accounts of Zaim-Express LLC
2 Default rate is defined as no payment received after 120 days of the origination of the loan
3 Data is not yet available for the quarter ended 31 December 2020 as the earliest time to determine default rates is 120 days after the end of the period
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