Hello, everyone, and welcome to the Kaspi.kz 4Q FY'23 Financial Results Conference Call. Thank you for standing by. My name is Daisy and I'll be your operator today. [Operator Instructions] I would now like to hand the call over to your host, David Ferguson from Kaspi to begin. So David, please go ahead..

Hey, hi, everybody. Thank you, Daisy. So, welcome to our Full Year 2023 Results Call. As usual, the full team are on the call. We've got Mikheil Lomtadze, Tengiz Mosidze and Yuri Didenko. I'm David Ferguson from Kaspi. We'll do the usual format. Mikheil will run you through the strategic update.

I'll take some of the financial slides and then we'll open the call up to Q&A and the whole team is available for your questions. So on that note, I'll pass the call over to Mikheil. Mikheil, over to you..

Hello, everyone. So it's our first call since we listed on Nasdaq, so it's exciting to report our 2023 and 4Q numbers and some of the strategic updates from me and some of the priorities which we're working on. So we can go through the presentation. I mean, first of all, our main goal really to list on the Nasdaq was also to achieve the high liquidity.

So, as you can see from this slide, average daily volumes are 12 times of London Stock Exchange. So, we believe that's great for the company and its shareholders. And as we made an announcement also that we'll be approaching to delist from London Stock Exchange to consolidate liquidity.

Our mission, to remind everyone, I think that's really important for us, our entire team is to develop the products which are highly relevant, they are world-class mobile services, high quality, but also innovate in order to improve people's lives. And we innovate through two sides of our sort of target customer.

That would be -- on the one hand, would be the merchant, and on the other hand would be a consumer. And the merchant is the Kaspi Pay mobile app and the consumer is Kaspi.kz. And both mobile apps are the super apps, what we call them. And our definition of the super app is all these different services which are in a single mobile application.

And those services are highly diverse and integrated around the regular needs of the consumers and the merchants. So, if we go to look into some of the services that we have in our apps, I'm not going to go through them, but I think, as you might appreciate, very few.

So companies have had such a range of the services for both consumers and the merchants.

So on the one hand, we have consumer super app, where we are serving 14 million monthly users, and here we have everything from e-commerce and grocery, to travel and fintech financial services, and buy now pay later, or general-purpose loan, the QR, which is the backbone of our proprietary payment network.

So, pretty much everything around shopping and the payments and moving money between the users, on the one hand, of the value chain for a consumer, and on the other hand, we have the services where the merchants can actually both connect to the marketplace, but also run the advertising campaigns, manage the delivery, access the merchant finance fully online, have a business account for their business.

And those are the services which we are developing -- we have been developing for merchants for the last several years, and we are kind of initial stage, actually, of the wave of innovations for the merchants.

So, on the one hand, you have everything around the daily needs and the regular needs of a consumer, and then on the other hand of our value chain, you have merchants that are actually selling the items to those consumers or accepting the payments from those consumers. And those two super apps are not separate from each other.

So basically what that means, they're actually connected through different ranges of services. David, next slide, please.

So here what you have -- you have connected through the proprietary payment network, and that really enables the merchants to accept the payments and the consumers to pay and the QR is the foundation for that proprietary payment network.

And we just move money between the consumers and merchants, and also between the merchants themselves and between the consumers themselves.

The marketplace enables -- if the payments enable to accept the payments or pay, then marketplace enables the merchants to sell their goods and items and services, and consumers to actually buy those services and the goods. Then we have the logistics platform, which also connects.

Again, merchants can onboard to our platform through their Kaspi Pay functionalities. And then consumers have a variety of the logistics sort of delivery options from Postomats, which is the automated personal machine sort of locker functionality, to door delivery, and then advertising, which we are also scaling.

And I will talk a bit about these services later. It's actually an ability for the merchants to advertise those services, to reach the right buyers at the right time with the right offer. And that's a very nice functionality, which also is useful for the consumers because it's highly personalized, but also for the merchants to increase their sales.

So, those two apps are connected through this sort of, what we would call, four platforms, the payments network, marketplace, platform, logistics, delivery, and the advertising services. And they're seamlessly working between them. Our priority historically has been always to drive the engagement, to drive the transactions.

And as you can see, just a reminder, we are one of the highest engaged apps compared to some other global apps, which you might know. So 65% is actually the share of the monthly users which visits our app daily. So, 65 people out of 100 monthly visitors would come, 65 would come daily to our app.

And that's really the result of all these different services around, regular needs of the consumer, which are in a single mobile application. And that's probably one of the also most important metrics, just to underline how relevant our services are.

And as we continuously adding the new services, the new verticals, enter the new businesses, if you look at our business, we have been constantly innovating.

We drive the transactions, and transactions are important just because that is actually our ability to deliver the value to the merchant and the consumer because the transaction is all about buying something, paying for something.

And as you can see on the GMV side of things, we've grown very nicely last year, 38% and we've grown also nicely on the payment transactions, 38% as well. So we processed KZT4.2 billion payments last year and almost KZT165 million purchase transactions.

And at the same time, as we sort of continue driving all those services and they grow individually, they contribute to the higher sort of transactional engagement for the consumer. So as you can see now, we are doing 71 monthly transactions per active consumer. So, that's up 17% from 60 transactions a month per consumer in 2022.

And that just basically tells you that consumers are transacting through our platforms two and more times a day. And that's really a remarkable number.

And again, the transactions are important because this is how we monetize directly through the value of the acquiring fee, the seller fees and now advertising and delivery, but also indirectly because this type of engagement really enables us to personalize highly the consumer experience and make sure that our business is constantly improving -- shows improving efficiency and the growth.

In terms of the financials, so, we are pretty much -- we did the guidance on six months before going into the US listing route. And as you -- going back, basically we pretty much exceeded every single guidance that we had on the six-month. The numbers on the financial performance are strong.

Our revenue increased 51% to reach $4.2 billion equivalent of KZT1.9 trillion in '23. Net income grew 44%, so to $1.9 billion.

And then the share -- the earnings per share have grown to $9.6 per share, which is 45% growth and we are also happy to announce that there will be a dividend proposed to the subject to the shareholder approval for the 4Q of '23 of about KZT8.50 per share dividend payment.

As we continue growing different services, the payments and marketplace are the fastest growth.

So, here we're also happy to report that we're sort of becoming the increasingly diversified business, very unique in its nature, but also all these different revenue sources and different net profit sources, which we constantly create by entering the new verticals.

So as you can see, 66% of our net income in '23 now comes from the payments and the marketplace. And those are the businesses which grow the fastest and actually they are front-end of the consumer relationship. And they will continue growing faster than a fintech, and will be taking increasing share of our bottom line -- and also in '24 and beyond.

This is cohorts. So we show cohorts in our annual numbers. So that basically is another indication of our growth. So, you can see that we have been growing nicely. Our cohorts are showing a very nice sort of similar growth year-over-year. And 62% of our consumer base comes from the four recent years.

So those consumers will continue transacting also in the future. And again, you can see the years we are sort of -- in the five years consumers transacting, we increased the TPV per consumer 12 times.

And if you look at pretty much every cohort, they are behaving in a very similar way, so which means there is more opportunity to do sort of volumes of the business around the consumer needs and, yeah, and we continue adding the more reasons for consumers to pay for. Another cohort is for our marketplace.

So, here you see the same strong growth, 50% of our consumers are coming from the last four years. And then the marketplace continues growing very nicely. We are probably one of the few marketplace platforms which have continuously grown after the COVID environment.

And that's really the reason behind that, is just because we continuously enter the new verticals we've started, if you remember, travel several years ago, and we entered grocery. And we constantly increased the assortment that is available for consumers to buy. So all of that really contributes sort of more reasons for consumers to shop.

And then all the added value services like delivery or advertising. They're also helping and driving the growth because they're convenient for consumers and they're increasing sales of the merchants. This is the slide about the penetration of some of our existing services that we have.

So as you can see, we have services which are sort of lower penetrated, especially on the marketplace side of things. And again, that's pretty natural, right? The consumer -- the step number one for a consumer to onboard is to actually pay, and they pay through the -- through our payment network and the QR transactions.

And then after payment, what comes is actually they can buy things and they can buy things which are e-commerce or the travel or the grocery. And all of that is really helping the merchants to first accept the payments, then they are listing their items and we're helping with the delivery and other services to increase their sales.

So, that's a natural evolution of the consumer journey. And some of the lower penetrated services that would be growing much faster than everything else would be under-penetrated ones, like grocery or the e-commerce, for example, the travel, so all those services have the very good potential for the growth.

And then some of the new services which we have been scaling and launched, like online car finance for example, which we're scaling as we speak, and that would be the -- also the foundation for the car marketplace which we intend to create.

So all of those services which you have now, basically some of them are -- will continue delivering the short growth just because they are under-penetrated, but even the penetrated services that we have are growing fast like QR payments as you can see, TPV has grew 43%.

On the merchant services, it's kind of another side of the value chain, right? So -- but pretty much the same. So the merchants are onboarding for the payments first and then they are moving to the commerce and the marketplace and listing their items that we're selling with the delivery and then they connect to delivery and advertising.

So here again you can see that e-commerce delivery, advertising which delivery and advertising sort of first suite of the value-added services for the merchants, they will be growing nicely, contributing to the revenue growth and the take rate. I will speak about it in more details further.

And then the merchant and micro business finance, that's really a good opportunity for us, under-penetrated on the market, the product is fully online, merchants love it. And as we continue providing financing for merchants, therefore, they are developing and growing.

And as they grow, there fuel growth of our marketplace and the payments and so on and so forth. So, there are a lot of network effects between different services in our merchant services -- existing services and then we have a pipeline for the new.

A bit about the grocery, just to -- one of the latest sort of services which we've launched, which will provide significant growth opportunity for us. So the market is an estimated about 14 billion double-digit growth market. We are in the weekly purchase. That is why we have sort of 11,000 SKUs and average ticket around $25, sorry, $29.

And then the delivery is sort of same-day delivery and it's largely free of the basket above KZT5,000. So -- and then delivery speed is pretty much the same delivery. And we're delivering the orders from the one central location which actually carries those 11,000 SKUs. So have been showing a very strong growth as a grocery business itself.

One of the -- when you look at the screens, you can actually see how the whole value chain is shaping up. So it's fully mobile. You can select everyday items from 11,000 skus. It's in size, it's $29 average order size, 99% is delivery for free. You can actually select the time when it's convenient for you to get the delivery.

And then because we're focused on the quality of the service, especially in the grocery, because that's a very repetitive shopping experience, you really want to make sure that you constantly deliver high quality.

So 92% of consumers rate service as excellent, which is extremely important because again, consumers shop weekly, right? So you want to make sure that your experience is high quality experience, is constant, and this is how you make it profitable.

You're not losing customers and you don't need to spend money on the marketing to bring the customers back, which could have been disappointed somewhere in the process of shopping with you. So, that's a simple overview of the shopping process with us. So, delivered the very high growth in '23. We've grew 3.9 times.

And around 0.5 million consumers shopped with us in '23. And the average ticket grew slightly during the year to $29 now and then we've enabled 5.2 million purchases in '23, which is 3.3 times growth. There has been a lot of discussion about very few markets where this business has been profitable.

So I think we just would like to put this discussion to that really. We told you last year that we would be focused on execution, delivering very consistent experience that results in profitability and efficiency. So this is the case study for Almaty. This is where we launched this service in last year.

And as you can see, in just 21 months, we are now -- we grew the revenue 154%. In 4Q, we achieved net income margin of 6%. Now, 4Q is a good quarter for any retail, right, because it's sort of New Year, Christmas shopping.

But still we were already profitable in the third Q, we were profitable in the second Q, as I've reported earlier, in the mid of last year. So, that basically is an extraordinary achievement by itself. And then in the fourth Q, we processed 1 million payments in the -- 1 million payments orders, sorry, in the fourth Q.

And we served 10% of the population. So around 218,000 consumers made the purchase with -- in Almaty with our e-grocery proposition. So, we're very excited about this business and we're scaling now in Almaty and Astana, which are the two largest cities, and we will be entering the third largest city also during the year.

So those would be almost half of the total retail trade in the country. And yeah, we're confident and comfortable that we can grow efficiently this business, deliver outstanding consumer experience, which actually results in efficiency and profitability for us. Tours, another example of our innovation last year.

So we launched Kaspi Tours vacation packages marketplace basically end of 2022 and we're scaling through 2023. So now what we have is full functioning marketplace. So you can search a vacation, the 71% of all destinations, the most popular ones are actually Turkey, Emirates and Egypt. Then you can select the hotel.

And we have about 6,000 offers of vacation packages in our app. You can read through all the details. And again, this is very important to keep in mind that this is a complicated user experience.

So, you want to make sure that you present the information fairly, the consumers are happy, they make the decision right, but you can also connect to the operators which are on the ground, which once you arrive to the airport, you will be greeted and meet and they will check you in the hotel.

And the good thing about this business is that it's -- in excess of 2,000 average tickets, which is very meaningful for the household budget, but also very good for us as an extension for airline and railway tickets.

And then it's fully integrated with our payments and fintech platform, so you can seamlessly pay and, yeah, again the consumer experience is extremely important, especially the family vacation. And almost 90% of consumers rate the service as excellent. So, we have been scaling this last year, so happy to report that has been growing very nicely.

So we grew during the year 185%. But what is actually important and we achieved 5% of the GMV of the travel business in a fourth Q. So we're just sort of starting but already quite a meaningful contribution.

But what is important is also the take rate, right? The take rate of this service on average has been around 8.7% and that basically is the take rate enhancing business for us. But also again, it's a very natural expansion for the travel value proposition, for our consumers. We started with airlines, if you remember.

Then we joined the train and now we moved into the vacation packages. So really excited about this business, we're continue growing this year. Postomats, that's another innovation which we have built during the last couple of years. Now we are almost 6,000, which was our target, if you remember. We are targeting this year 7,000 by end of 2024.

We largely build the network. So, the network of automated parcel machines now is the largest last-mile network for e-commerce in the country. We grew 78%, the number of postomats and almost 40% of all the deliveries are now done through the lockers Kaspi Postomats. And that again, just to remind you, right, the economics of it are quite simple.

Instead of delivering 70 parcels to individual apartments or the houses with a success ratio, actually is not -- it's -- you can have person is not there, consumer needs to talk to the courier for a comfortable time arrangement and so on and so forth, so it's not really that convenient as a postomat where you can actually go anytime you want.

And consumers love this experience. We're scaling it and that is very important source of our competitive advantage. But also it's an important backbone now for our smart logistics platform which we're developing.

So, if we look at the value chain of our logistics platform, we have taken the view that in order to deliver the parcels to consumers from merchants you don't really have to own that many assets, and really employ your shelf delivery people almost the same way like you don't really need to own the taxi and employ the taxi driver in order to provide the riding services.

So we took the view that we are building the platform which manages the entire network. It gets all the people and the entities participating in the value chain actually connect. So, we have some of the -- we have technology which enables the whole process management.

We have labeling, which is basically the entire same label sort of through the process, which is kind of extremely important for the efficiency. And then we have technology which is the machine learning, AI-driven technology in the middle, which basically makes sure that the routes are selected in the most efficient way.

And then we have a front-end of relationship with the couriers where we have app which actually manages the courier experience. So all of that really has been providing a very strong result. So, we have grown 130% in orders, 88% of those orders free, and we deliver over half of those orders in less than two days.

And again, this is probably the largest technology platform for delivery in the region. And we are enabling this without actually owning huge assets or employing directed delivery people. But we create a lot of jobs. So the infrastructure itself, if we go to the next slide, is actually quite impressive.

So, we serve around 60,000 merchants, almost 6,000 postomats we have across the country. We provide the platform and technology for almost around 2,500 couriers. We have delivery stations in the cities. We have the pickup points for the merchants, so the merchants also can deliver their items that consumers can pick up.

So we have line haul companies like airlines and big trucking companies. So, the whole value chain we manage is actually quite massive, 156 cities we deliver and the country size is huge, right? It's -- and we're still making this efficiently and continuously fueling our marketplace profitability.

So just -- yeah, we're excited and we will continue developing that technology in order to enable even more orders delivered as our marketplace continues growing, in e-commerce specifically, which grew very nicely last year and continues to grow this year.

As we continue thinking about the merchants, we are also delivering what we call sort of added value services for merchants. So this is an example of advertising which we have been carefully designing. So we deliver value for merchants. Merchants actually get the value in a sales increase at reasonable marketing costs.

So, merchants can actually -- this is an auction based, right? So it's almost like Google ads or Amazon ads, very similar sort of functionality by nature.

Merchants can launch the campaign, merchants can manage the campaign, select the kind of -- list the items which they want to advertise, they have analytics which they can decide on the efficiency of the advertising.

And we have been scaling this quite carefully, again, just to make sure that the merchants get the value for it, for the marketing money they spend. And I'm happy to report that the growth has been very nice. David, can I have next slide, please? So, growth has been very nice.

So as you can see on the advertising and the delivery, we have grown almost three times year-over-year, so 2.7 times growth on value-added services. Another angle to look at is take rate. So take rate is 1.4% additional take rate to seller fees from delivery, 0.5% take rate to advertising.

So added value services now contribute 1.9% of the take rate on e-commerce. And yeah, we're just really at initial stage of monetizing value-added services and driving the growth. And those are just two examples of those on top of the B2B payments. The B2B payments now is becoming a meaningful contributor to our business and the bottom line.

So as you can see that we have grown B2B to 2.1 times in '23. Now 2.4 billion worth of transactions and then almost 25 million transactions processed in '23.

And again, this business is enabling the transaction when guys like Coca-Cola or Pepsi, Nestle, they're delivering their sort of packages, items to the convenience store, we're settling the invoices seamlessly between this convenience store and the brand or its distributor or its wholesaler.

So, that is an extremely powerful business because we deliver a lot of value. We make these transactions seamless, almost like P2P payments for businesses. And that is our first service we launched on the B2B side of things. It still continues growing very nicely.

But if you combine together the payments and now we're thinking -- we're scaling advertising and delivery, all those services for B2B would be also added value services. B2B services would be the first range of innovation from us. But they have delivered already a very nice growth and contributed to the bottom line in 2023.

As we got focused on the classifieds, and I've mentioned to you last year that probably buying the car is one of the most important sort of household family decisions after buying the real estate, so we like this fact that now we can -- we're thinking about actually organizing the experience around that important household decision.

So, we are building the car marketplace where we enable the transaction, which is the dream for any classified, right, can you get to the transaction actually from just advertising? And here is an example of how we're getting this transaction enabled through our seamless online car loan financing. We leverage our fintech, again, scaling very nicely.

So, you can actually search for the car, you can select the car, you can immediately get approved, like -- which is an important functionality in our competitive advantage that we can actually approve seamlessly in seconds, high-quality financing and then you can pay all the fees that you need to pay around the car and its registration through our government, govtech platform, government services, and then you can pick up the car.

So, that's the process which is very seamless, high quality, and yeah, so we are scaling now. Intention is to build the car marketplace. We're also piloting 1P car marketplace with very promising results.

And yeah, I will just take the opportunity to talk about it later in the year, but really excited about building the car marketplace and actually different services around the cars that households can have. Yeah. To you, David, now..

Great. Thank you, Mikheil. So moving on to the financial performance of the business, starting with the payments platform. So firstly, volume. Payments platform fundamentally is the driver of engagement and competitive advantage in the business. What you see here is 12.9 million consumers, up 14% year-on-year, 581,000 merchants.

But as Mikheil talked about, the focus has not been growth in users, it's been growth using that large and engaged user base to drive transaction activity. And here you see very, very solid volume trends, up 30% in the fourth quarter, up 38% for the year.

Going forward, with reference to the cohort analysis you saw earlier, this growth just remains a function of us adding more opportunities for consumers and merchants to transact more payment functionality. Moving on to monetization, TPV is the measure of monetization.

You should keep in mind that inflation did moderate materially over the course of the year, and as a take rate business, both payments and the marketplace are impacted by that.

But irrespective, all key payment products continue to report very, very strong monetization trends, so, that's Kaspi Pay, merchant and consumer transactions, B2B payments and bill payments. And this is despite the fact that they are our most penetrated products.

The other takeaway from this slide is that whilst take rate was stable over the course of the year, it did move up in the fourth quarter to 1.3% from 1.2%. That is a result of higher margin bill payments and that will remain a theme in 2024. In terms of mix, what you see here is that B2B payments is now 4% of TPV.

It was 3% this time last year, so that is our fastest-growing payment product, but still early days.

This year, the focus is still on driving transaction volumes between merchants and their suppliers, but over time this will open up more opportunities for more merchant or more vertical-specific products and services, both within payments and across the other platforms.

Turning to revenue and profitability with the take rate moving up in the fourth quarter, revenue growth up 33% is ahead of volume growth of 30%, and for the year, revenue growth of 44% is slightly ahead of volume growth.

The usual takeaway from this slide though is that payments profitability or operational gearing remains as strong as it ever has been.

Our proprietary network and the elimination of third-party costs, tight cost control, and operational gearing again resulted in profitability reaching all-time high levels with, for the year, net income up 55% versus revenue up 44%. Looking forward, we expect payment platform to continue to benefit as existing consumers spend more with us.

Our leading market position in deposits, local currency deposits will also be helpful in that regard, will keep adding more opportunities for both merchants and consumers to transact. B2B expands the addressable -- B2B expands the addressable market further and will stay disciplined on costs going forward, keeping the operational gearing intact.

Moving on to marketplace. So just as with payments, the focus in the marketplace is on growing transaction levels, and here too you see very solid results. Transaction levels up 26% in the fourth quarter.

You should keep in mind that there cannot be some variability on a quarter-on-quarter basis linked to the timing of different promotional campaigns, but a very healthy number up 38% for the year.

And whilst not the focus, the growth in the number of marketplace consumers up 18% to 7.1 million, that's remained strong and consistent throughout the year. And there's clearly more to go for in that regard. Moving to the marketplace GMV.

GMV growth is ahead of volume growth, but again, the real takeaway here is the increase in take rate, 9.2% for the year versus 8.2% this time last year. So, that's a function of sort of two things playing out. E-commerce is growing faster than m-commerce and e-commerce is higher take rate.

E-commerce, in addition, is benefiting from value-added services, primarily advertising and delivery, that Mikheil talked about. Going forward, you can expect more of the same as merchants migrate from payments and m-commerce to e-commerce. And if Marketplace was the standout platform, within marketplace, e-commerce delivered the standout results.

So here, very clearly, you see that strong volume growth coming through with volumes up 77% in the fourth quarter, up 122% year-on-year for the full year, GMV growth is below volume growth, and that reflects the addition of volume from lower ticket size items, primarily grocery and on that you see that grocery or 1P is now 4% of marketplace of e-commerce GMV, which is a good result within a relatively short period of time.

The take rate improvement is most pronounced for e-commerce moving up to 11% from 9.4% for the full year driven by value-added services and delivery.

Whilst going forward there is and will be a migration to e-commerce as the least penetrated of the core marketplace products, m-commerce still continues to report very, very robust growth with e-commerce -- with m-commerce GMV up 18% year-on-year, ahead of volume growth.

Here also takes rate expansion for the year moving up to 8.6% from 8.2%, a function of successful promotional activity over the course of the year. And then moving to Kaspi Travel, like e-commerce, a very, very strong results for the year. All key elements flights, rail and tours playing their part.

But as Mikheil talked about, tours, in particular, have gone from 0% of GMV to around 5% in less than 12 months. So, one, tours are GMV additive; and two, tours are also take rate additive, 8.7% take rates on tours. That's the driver of that increase in take rate for the year to 4.3% from a 3.8%.

And clearly, here it's still early days in terms of the rollout of that product and more to go for in 2024. So what does this mean for marketplace financials? With revenue -- with take rate moving up, revenue growth is in excess of GMV growth up 87% year-on-year for the full year, boosted also by grocery.

The inclusion of grocery in revenue growth does result in net income growing at a slower rate, but net income growth of 63% is still a very, very strong result.

Going forward for the marketplace, we will continue to add new shopping categories to drive transactions per consumer with regard to e-commerce, specifically, e-commerce in 2022 still only accounted for 8% of retail and so is under-penetrated and a fast-growing structural growth opportunity.

M-commerce will benefit as services, again, take share within the economy from a low base, and in the contact case of e-grocery, it's still very much early days with an autos marketplace also likely to become more meaningful over the medium term.

And autos is a market which is offline, ripe for digital disruption and on top of all this, you'll have advertising, marketing, services and delivery all continuing to play their part as well.

Moving on to the fintech platform, we said that really the focus last year was on growing the deposit side of the business and I think the numbers are pretty clear here growth in deposit consumers, up 27% year-on-year versus growth in fintech or loan consumers up 12% year-on-year.

What you also saw, the context of a stable economic backdrop is that lending origination remains at very, very healthy levels, up 36% year-on-year in the fourth quarter, up 47% for the full year. Growth in deposit customers is indicative of a strong consumer environment.

Portfolio conversion of 2.2 times is indicative of a strong consumer environment as consumers borrow, repay quickly. Growth is being driven by buy now, pay later, our most important fintech product.

But increasingly merchant financing, which is our fastest growing lending product, is now of a level of decent scale at 15% of origination where it continued to make a big difference and we see both merchant financing and car financing as being structurally underpenetrated in Kazakhstan.

Expect both of these integrated lending products to move up as the marketplace continues to evolve. A similar message is really on this slide, deposit growth for the year up 43% ahead of loan portfolio growth, up 32%. A small reduction in loan-to-deposit ratio year-on-year.

But ultimately we have good potential here with this deposit base to drive more payment transactions and/or to scale up lending originations further over the medium term.

Yield moved down slightly year-on-year and that is a reflection of buy now pay later, and merchant financing growing their share within the mix, but is consistent with everything we've talked about previously. Looking at risk metrics are healthy trends across the board, so that's both credit origination and credit collection.

And that ultimately translates into a 2% cost of risk stable year-on-year and consistent again with the trends that we've talked about throughout the year. NPLs moved down year-on-year to 5.5%. They can be here too, seasonality in the quarterly numbers, but overall going forward, we'd expect the NPLs to stay at broadly around current levels.

So, looking at fintech financials, the combination of decent TFV growth, normalized origination really over the last 18 months is translating into good revenue growth, albeit with some slight yield reduction. The growth in the deposit base and the increase in the cost of the funding does have an impact on net income.

Net income growth 23% versus revenue growth of 38% over the medium term, assuming rates fall. This should be positive for net income growth again. And as we've mentioned earlier, that enlarged deposit base is fundamentally a competitive advantage.

So going forward for fintech, consumer lending remains structurally underpenetrated, as does merchant finance, in fact, to a greater extent. And as the leader in local currency deposits, we're well positioned to benefit from structural growth in fintech products.

Consolidated performance for the year, I mean, I won't sort of repeat anything that I've said previously. I think the simple point to take away here is these numbers exceed the guidance we provided at the H1 stage just prior to going into the US SEC process, and they materially exceed the guidance we started 2023 with this time 12 months ago.

So, looking to 2024 and the guidance for this year, we are simplifying our approach. We will now just guide on revenue and net income. This is more consistent with our US peer group. The individual KPI components that makeup revenue and net income, we will continue to disclose in the usual way.

It's just that the guidance will ultimately reflect the end results. Running through these just as this year, marketplace is expected to deliver the strongest performance. So again, that trend of merchants moving from payments to m-commerce and from m-commerce to e-commerce, e-commerce and e-grocery being the biggest top line drivers.

E-com, I mentioned earlier, structurally underpenetrated e-grocery still day one in Kazakhstan, with delivery and advertising also additive to revenue growth. 1P, primarily e-grocery does result in lower net income growth versus revenue up 40%, but that is still a pretty robust bottom line growth number.

Payments are similar trends to those that we've just discussed for 2023. Revenue growth on the back of robust consumer and merchant trends. B2B, additive to top line take rate expansion due to higher take rate from bill payments will ensure that revenue grows faster than TPV.

But the main takeaway, again, is that payments operational gearing remains intact. So, bottom line growth of 25% ahead of revenue growth of 20%. And then finally moving on to fintech, expect another decent year, the TFV origination over the last six to nine months will drive revenue growth in 2024.

Broadly stable trends in terms of yield on the cost side, broadly stable trends in terms of risk, an enlarged deposit base, and a higher cost of funding still impacting bottom line in the near term. So overall, we're looking for consolidated bottom line growth of around 25% year-on-year.

So another year of fast earnings growth at scale and within that marketplace and payments are faster growing and more profitable segments continuing to take share within the mix.

Just the other point that I would add with regard to the London delisting, I just draw people's attention to -- there is a Q&A provided in the press release today, so if there are any questions specifically on the London delisting, you might find it helpful -- that Q&A section, you might find it helpful. So to just draw that to people's attention.

But on that note, Daisy, let's open the call up to Q&A, please..

[Operator Instructions] Our first question today is from Gabor Kemeny from Autonomous. Gabor, please go ahead. Your line is open..

Hi. Thanks for this detailed presentation. My first question is on e-commerce and specifically on the merchant base. Now you show that e-commerce merchants are 11% of your total merchant base now, and I think you flag the opportunity to onboard more of your merchants to e-commerce.

So, can you talk a bit about this opportunity, what initiatives you have in place, and what do you see as the potential size of your e-commerce merchant base? My other question was also on e-commerce and e-commerce take rate, you flagged that you are in the early stages of monetizing the value-added services.

I wondered what your latest thoughts were on the pace of monetizing these value-added services. And my final question is on the payment take rate. I understand you expect stable take rate this year, but select the take rate addition from the higher take rate from the higher margin Bill Payments merchants.

What is the take rate in that segment? And if you can help us understand, what do you expect to offset this whereby you assume stable payment take rate for the full year? Thank you..

All right, Gabor. So, thank you very much for your questions. I'll take your question on payments guidance and then hand over to Mikheil for your questions on e-commerce merchants and value-added services. So we're not going to disclose product by product line in payments.

What I would just say you've got different dynamics there so on the sort of downside, you have Kaspi Pay. So actually, it's well known in the public domain, that's at 95 bps, so below the average take rate. And then you also have other products, some above, some below.

It's certainly true that Bill Payments has seen some take rate increasing as the mix changes there, particularly driven by digital payment services. But overall, I think still to think about broadly stable take rate is a pretty clear message and it wouldn't make a big deal in either direction..

Yes, you want to pick me -- you want me to take the question about e-commerce and merchants, right?.

Yes, please..

So in terms of the merchant base, even though it's a nice number really to look at, I think, in general, our strategy is just to make sure that the consumers can find the right assortment they're looking for.

So the demand for our marketplace is extremely high from the merchants, just because if you imagine 14 million monthly users, those are the commercially minded buyers with the payments and the funding functionality. So, on our side, really, the merchant number is just, I would say, probably is just the resulting number.

So what we are focused on is just to make sure that we are enabling the merchants to buy the items they are looking for. So that's basically about the merchants. It's just a natural migration of the merchants to e-commerce just because we just give them a lot of high-quality sales uplift.

But again, we're focused on making sure that the existing merchants can sell, making sure that the consumers can buy the items that they want to buy. In terms of the take rate, our strategy has been quite consistent. We want to make sure that if you are a merchant and you are spending money with us, we actually deliver value.

So, if you are advertising, for example, then we deliver the value that your sale is going up. But at the same time, we have to make sure that we are providing a high-quality experience for both consumers and the remaining merchants.

We don't want to be in the environment, like many other leading marketplaces, where you cannot sell if you don't advertise. So, that's not our strategy. Therefore, I wouldn't expect that the take rate will be growing at astronomical rates. It will be still a very reasonable growth within the revenue guidance we've provided.

But again, that is just another stream of revenue.

The one thing which I would like to mention is we entered grocery just basically briefly, right? So our team is doing a great job on scaling that at a very efficient profitable way with the happy consumers and we have pretty much become one of the leading grocers now in Almaty, which is the largest city in the country.

And as we've become the largest grocer now, we have quite a lot of fast-moving consumer goods companies coming to us and asking us to develop the products, advertising products for them.

So that would be another revenue stream which does come from the merchants themselves, but actually comes from some of the brands and the companies that manufacture the items which we sell. And that's a great place to be in.

For any company, if your user base coming to you and asking you to develop the products for them, I think this is probably the best position that any business can be. You just listen to your merchants and your consumers and make sure you provide the high-quality products..

Very interesting. Thank you..

Thank you. Our next question today is from James Friedman from SIG. James, please go ahead. Your line is open..

Hi. Thank you for taking my question. So, I wanted to ask a much more high-level question, and it kind of combines Slide 8 and then Slide 11. And thank you for this incremental disclosure on Slide 11.

But in Slide 8, I was just wondering if you could help orient us as to this continued sharp increase in engagement, 71 versus 60 in terms of the monthly activities, up 13% -- up 17%, excuse me. Yeah. So what services or products in particular resonated in 2023 to drive that kind of increase? And then I guess Slide 11, this would be a longer view.

But if you were to look at the year five cohort, which is up 12 times since 2018, how have you seen the profile of that engagement evolve? I mean, clearly the number is powerful. I'm just curious as to what type of product or services over that duration has really expanded the engagement to that magnitude? Thank you..

Okay, thanks. James, Mikheil, over to you..

Yeah, sure. Well, in terms of the number of transactions per consumer, I mean, if you think what we have been creating, it's something really unique, but there is a simple view that we are expanding around the regular needs of the consumers, right.

I mean, initially we started with the payments and sort of just moving money between your accounts and friends or family, and then we moved towards merchants and as we continue growing the merchant base, we just give you, as a consumer, more reasons to spend.

So all the money which comes in is basically digital money, right? It's all cashless transactions and they start from us, the spending around their household budget. So that's what is really driving the transactions. It's almost like a replication of how many times you open up your wallet during the day in order to pay for something.

In Kazakhstan, you don't need a wallet anymore, because it's a Kaspi.kz App in your pocket. So, that basically is a proxy for our intensity.

So, we're just going through -- we are going around everything that you are, as a consumer, you are spending money for and we just made the whole spending exercise digital and we replaced your wallet with the cash with our mobile app with the digital money on it. So, that's basically what drives the transactions.

Going forward, there will be another uplift just because we're digitalizing grocery and grocery is a high-frequency transaction and we are going after weekly purchases at the moment, but that's not going to be our finish line.

So, that's something also basically just gives you another sort of uplift in terms of the frequency and the transactions around the consumer. So, that's about the transactions per consumer, James, and engagements and then around slide number 11, David, I think was a question..

Okay, great. So here, what you see, it's almost like this question is around the same question, right? So it's like why the transactions per consumer is growing. So again, we started in 2018, we just had much fewer reasons for consumers to pay through us. We're just only in the beginning of building the payment network.

We were just entering the e-commerce space with, I don't remember how many SKUs we had, but we had maybe a couple of hundred thousand, something like that, if not less. And now we have close to 5 million SKUs on our e-commerce platform. So again, as we continue in the merchant base, almost 600,000 merchants you can spend money with.

So as we continue -- as we build the merchant base, we build the consumer base and we connected them to each other to the payment network and we gave more reasons for a consumer to use digital money rather than cash. All of that basically has been the growth driver.

And going forward, again we will be -- from the services that we have today, the services like grocery, for example, will be the ones contributing to the transactions as well as the services industry, which is an interesting target for us as well.

Services, I mean, anything that cannot be delivered, right, so it can be restaurants or barber shops and things like that. I'm just making a general statement about the service industry. I don't want to speak about the exact innovation plans that we have on this call. I would rather have you to see our results rather than talk about them..

Perfect. Thank you both..

Thank you, James..

Thank you. Our next question is from Will Vu from Wolfe Research. Will, please go ahead. Your line is open..

Hey guys, this is Will on for Darrin Peller here at Wolfe. Just two questions from me. The first one just on the fintech yield expectation in fiscal year '24.

I mean, just looking at your guidance, it calls for stable fintech yield year-over-year, despite kind of seeing a higher mix towards BNPL and looking broadly with interest rates coming down, maybe just kind of walk us through some of the puts and takes on this dynamic here.

And then the second question that I had was just around the car marketplaces opportunity. You guys talked about car marketplaces being more of a strategic priority for Kaspi in 2024. Maybe just expand upon that a little bit.

How should we think about the TAM and ultimately why now?.

Okay, Will. So, thanks a lot for your questions. I'll take the first one on the yield guidance. So, stable doesn't mean identical, it means broadly similar. I think if you look at the trend over the last couple of years, and you look at the trend last year, last year the yield moved 26% from 27%.

And that sort of delta is not inconsistent with previous years. So, the puts and the pulls are on what's bringing the yield down. It's buy now pay later. But that could be structured in different ways. But one way is 0% for three months, and that's not the only way. But that's a component of it. And merchant financing, which is a lower-yielding product.

So that's on the one side. On the other side, the higher yielding products are primarily the general purpose loan, which has declined in the mix and will continue to decline in the mix. So, they are the sort of two sides of the equation. But I wouldn't expect, again, it's like Gabor's question on payment take rate.

The point about stable is to indicate not sort of some dramatic change in trend year-on-year, around the same plus or minus something consistent with what you've seen previously. And then I'll hand over to Mikheil on the car marketplace opportunity..

I mean I would prefer to describe later in the year in a bit more detail. So, I will just take a step back and maybe I'll just explain the strategic view of certain things, how we actually operate.

That is just a decision a consumer is taking to buy a car and when you think about buying a car, there are so many services related to that decision, right? You need the tires.

Well, you need to register the car first of all, or you need to get the financing to buy a car, then you need to register a car, then you need to buy the tires, then you need to fill up the car with the gas, then you need to buy some of the spare parts during the year.

And if something major breaks, then you actually go to the service station and you do that.

And if you think about some of the services which can be built around this decision of a consumer are quite exciting, right? I mean -- so from that perspective, what we are really excited about is once we now have the decision point for a consumer, that consumer can buy a car because we have the largest classified on the car side, now we just would like to build an organized consumer experience around that decision point.

So, that's basically why we are excited about it. It just happens that we are already the number one tire-selling marketplace in the country already and we are the largest car registration platform when people change their ownership, and we are also probably now number one in car lending online car loan business as well.

So, all that is really just excites us that we can organize the consumer experience and just make it more seamless and therefore deliver more value for a consumer and then deliver more value for the merchants that participate in all these car-related activities.

So your question was why now? And it's just because now we have this decision point about the car because we acquired the leading car marketplace last year. At time of acquisition, I mentioned that the decision of buying the car is the most important.

The reason why the car classified is a great addition is not because it's number one car classified, but it's because now we have a consumer making the decision about the car in our user story and we can build from there.

So really excited and later in the year, we will be giving you a bit of more details and the specific use cases as we've done before, travel, e-grocery, B2B payments, all of those, advertising, all of those businesses we've started from use cases and now they're growing very rapidly..

Great. Thanks..

Thank you. Our next question today will be from Joshua Samuel from Mawer Investment Management. Joshua, please go ahead. Your line is open..

Hey, thanks. So just one question on the e-commerce marketplace. I've been reading that you've got competitors like I think Wildberries, Ozon are investing quite heavily in Kazakhstan.

Could you just walk me through, Mikheil, how are you positioning the company to defend your position in the -- we have a very strong position in the e-commerce marketplace and I guess you want to avoid that outcome like Alibaba, right.

So as a market leader, how do you prevent such outcomes in the future?.

Sure. Well, I mean if you look at our business, the most important competitive advantage we have is the consumer is transacting with us two times a day, more than two times a day. And that's a single mobile application.

So, the consumer is not just coming to buy something from the marketplace, they're actually coming for a daily usage around their entire daily activity.

So, that is the most important competitive advantage in our case and compared to Ozon or Wildberries, it's just the business model that we have has such strong network effects that for these guys they can invest and provide the discounts and run the crazy promotional campaigns and might have uplift on a temporary basis, but then the consumer will buy from you at a very heavy discount and then they come back to our platform because they open our app multiple times during the day.

So, our consumers are actually very much involved in our business. So you cannot take just e-commerce or marketplace as a standalone basis, right. That's a very important difference from others. The second I would say that we are a marketplace which means we are not apart from the grocery part of our business, we're not trading the items.

So, we actually help the merchants to grow and we give them tools to grow. And from that point of view any entrant that is coming on the market they are not competing just against us.

They're really competing against all this universe of the merchants which are providing the, which are selling items through us and we just give them technology, right? So, from that perspective, I think it's also a very powerful part of our business.

And then the third piece is that we are constantly building the networks, right? So, we have the largest last-mile delivery network for example in the country with almost 6,000 automated parcel machines. And delivery is also a source of very important competitive advantage.

So, yeah, we put our heads down and we're just making sure that we deliver the outstanding quality of the products for the consumers and innovation for the merchants, so they grow the sales and reinforced by the payment network, reinforced by the delivery network, reinforced by the super app network function that provides a very important source of competitive advantage.

So, that's basically our view and we constantly expand the new categories, right, so that's an important part of our business as well..

Thank you. Do you -- but just a follow-up, do you feel the need to, I guess, price defensively in any of your categories? I think I've heard Wildberries is -- I think they're potentially like lowest price at the moment for some products..

Well, they can be lower priced on some products if they want to. In our case we are working around the consumer and merchant needs sort of overall. So we don't really feel anything -- and any pressure for us to provide any kind of price discounts.

Again, these guys are just bleeding the money, right? They run promotional campaigns, consumers would buy something at heavy discount but then they come back to us for actual real purchases and we just need to make sure that we have the items which they want to buy and they're looking for.

And if you look at our growth rates and the development that we have, yeah, we don't feel like we need to compete on the price, but our merchants you should understand, right? So when one item has 50 offers, 60 offers from the merchants, actually merchants themselves are providing very competitive prices, right.

So, that's very important to keep in mind. It's not Kaspi competing against Ozon as a merchant, right, or their merchant.

It's our merchants, actually, and because we have such a high number of merchants and the price liquidity and prices of the items that we have are actually quite -- very competitive compared to the prices which other players are offering. And then the speed of delivery, it's making a very important -- delivering very important value to the consumer..

Got it. Thanks..

Thank you..

Thank you. Our next question is from Sam Griffiths from Vergent Asset Management. Sam, please go ahead. Your line is open..

Hi, guys. Thanks for the call and congratulations on the successful listing and a great set of numbers. I have three questions, please. The first is how you think about the TAM for the number of consumers that you could finance. When you look at your active consumer base, you've got a lot of data on these people.

How are you thinking about the penetration there? Where can that get it to? That's the first one.

The second question is on the merchant services, as you grow that business, whether it be in B2B payments or merchant financing, is there any appetite to grow kind of any products on the funding side, maybe going aggressively after merchant deposits or whatever? Any comments there would be great.

And then finally on the logistics platform, I just wanted to check, is this just for e-commerce, or is there also an opportunity to plug into more general supply chains within the country? Thank you..

Thanks, Sam.

Do you want to take those, Mikheil?.

Yeah, sure. So in terms of the target market, I would say that the way to think about our business model is that the businesses which are front-end of the merchant and the consumer relationship, those are the ones which are driving the financing or the fintech side of things, right. So, you basically don't need money as a consumer.

You want to buy something with it. You want to buy a car, you want to buy an iPhone, you want to buy a TV, and you want to buy tires and so on and so forth. So actually, the driver of the fintech side is the shopping and the payment activity of our consumers. So, that's a very important point about the growth.

Therefore, the marketplace, and the payments and marketplace specifically will be growing faster because they are front-end and the fintech is actually back-end. Merchants, they don't need just money. They need money to buy the same sort of inventory which they sell in our marketplace.

So, that's basically on the financing side of things, the sort of -- in terms of the target market, you can just think whatever consumers are buying and the merchants are buying to sell, and consumers are buying from those merchants.

And again, the consumer finance is extremely underpenetrated, and merchant finance, we believe, even more underpenetrated because there are very few products on the market which would be seamless and fully online. And the car finance, we're just scaling as we speak.

In terms of the merchant services, I mean, I would say that we are innovating around the needs of our consumers and the use cases which we see from the consumer or the merchant behavior and the data. So, from that perspective, we are excited about building the business around the merchants, the merchant financing and the B2B is one of those.

This year, we still want to focus on building the payments as a foundation of transactions between the businesses, because that's how we have done before. If you think about the consumers, the same, right. We build the payments initially and then connect with consumers and the merchants, and then we start building on top of it value-added services.

So, the same will happen with the merchants. There are some of the services which we already provide, like a cash register, for example, we provide to merchants for free.

But that, again, enables us to work with the merchants more closely and help them with inventory and finance that inventory with the merchant finance and enable the B2B payments to actually get this inventory delivered and settle invoice with the brand.

So, yeah, merchant services, there will be a wave of innovation and in terms of the logistics platform, at this stage, we're really focused on enabling the consumer and the merchant.

So, basically, pick up from merchant, deliver to the consumer through the customer directly to the door and that would be our important priority again, we're growing at such a rate that we want to make sure that we build the foundation. It's almost like build the foundation for the skyscraper before you start adding the services.

And at this stage, that would be our priority, especially this year. But then you probably know, Sam, better than me that logistics can go all sorts of ways, right? It can go different ways. It can go between the consumers. It can go between the merchants. It's really a platform which can deleverage.

But at this stage, we are focused on delivering the items from the merchants to a consumer and to build the scale..

That's super helpful. Just one follow-up, please.

Mikheil, when you think about the overall funding profile of the lending business, do you expect that to stick mainly on the consumer side going forward as the business evolves? Or is there more room for maybe funding for merchants to play a part as well?.

Yeah, sorry, I missed that piece of your merchant services question. We are basically driven by the merchants. So -- and again, this is the great place to be. That's the advantage of our business model.

So now, for example, we started with the payments, there is an actual business account of the merchant in our super app, which is fully validated and KYC'd. And now where we actually are is that the merchants have some -- they increase their sales, especially after our promotional events, they have some cash on their accounts.

So if you would be a merchant, you would be asking us to develop the deposit product, because there is cash sitting on your accounts. So, that would be a response to your question.

The merchants are asking us to do that product, and we feel there is a use case for it and there is a scale, and we can deliver the value by building the best merchant deposit product on the market..

That's very clear. Thank you..

Thank you..

Thank you. Our next question is from David Shapiro from Vanshap Capital. David, please go ahead. David has removed his question, so I'm going to move on to our next question. Our next question is -- David has registered a question again. So I'm going to open David's line now..

Hi, David. Go ahead. If you're still there..

I'm still here. Sorry about that. Congratulations on the listing, and thanks to management and all the employees for working hard on behalf of the shareholders. Just three quick questions. First question regarding the capital return and how you guys are thinking about it. Obviously, you listed the float is still rather limited.

So, how do you balance the ongoing share buyback program, which is obviously, at the current price, extremely attractive and well thought out, versus wanting to encourage more liquidity on the exchange itself? So that's one question. Second question. Around foreign expansion.

As you look to maybe neighboring countries, right now, what do you see as the biggest hurdles, besides obviously the big plate of items that you have domestically? Is there anything that's challenging getting into foreign markets, such as regulatorily speaking or lack of adequate targets or prominent targets, that would be good for Kaspi to enter to.

So I just wanted to see what the major hurdles were at this point.

And lastly, when you look at your guidance for 2024, just broadly speaking, are there any sort of big regulatory challenges that you can see locally, either on tax rate or perhaps interest rate caps, especially with the new administration -- I'm sorry, the new cabinet that is coming in for the current government.

So, anything that you want to flag potentially that's incorporated in your guidance or that could potentially change some of those thought processes around underlying profitability?.

All right, David, thanks for those questions. I'll take the capital allocation, then pass over to Mikheil for the remaining questions. So, the simple answer is that the US listing doesn't change anything over the medium term in terms of our approach to returning capital -- in terms of our approach to capital allocation.

So, number one, first call on cash is always investing in the business, unchanged. Number two, if we have excess cash, we return it to shareholders, unchanged. The track record of returning cash via both dividends and buybacks speaks for itself.

And specifically with regard to buybacks, I think since we started the program, we bought back $277 million in roughly over 18 months. Like yourself, we feel that the stock's valuation does not adequately reflect the growth outlook. It's true that there's no new buyback program today, but we reserve the right to step in at any point in the future.

We talked about an opportunistic approach in the press release, but I think you're right at this stage, so soon after the US listing, it would be nice to see what the real level of liquidity is in the market, and that might take a little bit longer for us to find. So just let's see how things evolve. On the rest of it, I'll pass over to Mikheil..

Sure. Thank you. David, thank you for those questions. I would make another -- just comment in terms of our liquidity and capital allocation.

We are focused really on the company and its growth, and we are making decisions what is in the best of interest of the company, because that's something which we don't control the stock price, but we actually are responsible for execution.

So, things that we are focused on really is the company itself, because we have a very much long-term focus on our business. In terms of the two other questions, expansion. It's just a really good place to be for us. We have companies across many markets just approaching us on different levels with different ideas for us, and how we can get involved.

So it's really very preliminary at this stage. Nothing specific for me to report, but it's not a question if, it's actually question when, and which target and which market. So, that's as specific as I can be. And I've mentioned several times that's the number one priority on our management list of things to be done.

And if Kaspi's management gets something into their priority list, it gets done, as simple as is. In terms of the guidance, I would say in general, there is nothing really for us to report.

The country's leadership and President Tokayev, he has mentioned about executing the reforms and wants those reforms to be done on the basis of the economy growing and the investment climate also growing and becoming even more attractive for investments.

So, I think that's basically the foundation and extremely important for everything else is really important details, obviously, but most important is that the country, and the President they have, the view of that needs to be a good place for investors to invest. And I think that's an important foundation for everything else.

So, our guidance basically is nothing really specific for us to report. And as you guys know, we never speculate about things..

Thank you, gentlemen..

Thanks, David..

Thank you. We have time for one more question today. If you can kindly just limit yourself to one question. And we will be taking it from Can Demir from Wood & Co. Can please go ahead? Your line is open..

Yes. Hi, thank you for taking my question. I actually want to ask a more broad question as I'm following the per active customer TPV on the payment side of things, that number has reached $430 per month, give or take. And the average wage in Kazakhstan is around, I think $700 or $800, of course, for working people.

So, Mikheil, how should we think about this? Because people seem to be spending a lot relative to what they earn. So, I just wondered what you would make out of the numbers that I mentioned. Thank you..

You want to take that, Mikheil?.

Yeah, sure. I mean, in general, I would say that these payments, the movements around the consumer's money is also all about the savings that they have with us when they -- we are the largest savings institution in local currency at the moment and ticket size is about $3,000 for consumers.

So, the consumers are not just spending with us, but the top of our funnel is the consumers are actually saving with us as well. So that would be just the one sort of simple example. I think we do have a number of savings consumers here, right, David, I think just as an example, no, yeah..

4.8 million..

So, let's say, 4.8 million consumers saving with us. So that's just really one use case, right? Another thing about the payments per consumer is also the consumers are moving money between themselves. And you saw that the P2P, which is monetized, the penetration rate of this is what is about, I don't remember specifically, it's about 13 -- yeah 34%.

So, the TPV which consumers have with us is also about consumers actually moving money between themselves, friends, and family. So, it's just much more than the average salary that the person is getting..

Okay, so P2P is now chargeable because I remember in the past it wasn't really chargeable..

The vast majority of the P2P transactions is free of charge, but P2P transactions which at the moment are monetized, those are the transactions when you are moving the money, for example, from our wallet to the other card, or you're spending money abroad or moving the money abroad.

So, those are the kind of monetized -- vast majority of the transactions which are between accounts and between the consumers, they are free of charge. Nothing changed in our pricing policy. It remains exactly the same..

Okay, maybe just one clarification, sorry for that one, but so you're saying 34% of the current chargeable volume is related to those chargeable P2P transactions..

Correct? Yeah. If you take, this is the share. David, can you pull up the slide, please, on the penetration of consumer products? The next one? Yeah. Great. So 34%, actually, if you look at the P2P penetration as a P2P service itself, it would be close to the 90%, basically.

So that's the penetration of 34% is only the P2P transactions which are not monetized. Sorry -- which are monetized..

Which are monetized, okay..

Much more, it's almost 90% would be the penetration of P2P which is not monetized. We're just showing here for the purposes of revenue. And that's why -- and TPV, that's why you have here only monetized transactions, but unmonetized is almost 90% penetration..

Okay, that's super helpful. Thank you..

Thank you, Cam..

Okay. So I think, Daisy, that wraps things off. So thank you, everyone, for participating in the call. Thank you for your questions. I know there are some written questions we haven't been able to answer, so apologies, but happy to follow up directly. Thank you very much, everyone. And we'll speak to you at our Q1 results in April. Thank you. Bye-bye..

Thank you. Bye-bye..

Thank you, everyone, for joining today's call. You may now disconnect and have a lovely day..