In less than a month after deploying its 500th ATM, FinTech company Findi (ASX: FND) has unlocked a new milestone on its India journey. The Company has surpassed the deployment of 1,000 ATMs for the Central Bank of India (CBI) ahead of schedule.
While much of the country has transitioned to digital payments (with over 72 billion virtual transactions recorded in FY22), India’s rural segments continue to be cash-starved and -reliant. Rural India’s dependence on ATMs and the need for greater ATM penetration is proving successful for Findi, which has been brought on by the CBI and the State Bank of India to set up the machines across the country.
In the Indian market, cash in circulation has increased by 16% CAGR over the last five years while 80% of eCommerce is now conducted via cash in non-metropolitan areas. Findi’s strategy is backed by these market dynamics as it seeks to have a customer ecosystem of cash, payments and digital transactions.
The majority of the latest 500 ATMs deployed are located in rural and semi-rural areas of India, where cash transactions are far more prevalent than the metro areas. The availability of Findi’s ATMs in these regions supports financial inclusion and enables transactions for the unbanked population.
In March of this year, the Company signed a five-year contract with the Central Bank of India to deploy 2,550 ATMs across the country. Ten months in, it is about halfway through this goal.
Findi is all set to deploy ATMs faster as CBI tries to approve as many sites as possible for operation. Thanks to that, the deployment of the remaining 1,550 ATMs is on track to be completed by the end of FY23.
The new 1,000 ATMs under the CBI contract utilise Findi’s new Ticket Management Platform (TMP). It has lowered monthly recurring costs and enabled additional features like seamlessly integrating multiple customers, vendors and in-house applications. Plus, it allows for integration with multiple switches, thus delivering a scalable platform. The TMP makes Findi white-label ATM ready while eliminating third-party vendor dependencies.
Findi Limited Chairman, Nicholas Smedley, commented, “The implementation of our proprietary new Ticket Management Platform is industry leading and, pleasingly, our speed of deployment for CBI has accelerated, despite additional holidays in India through the second half of the year”
Owning and managing ATMs in India—as Findi does—is no cakewalk. In October last year, India’s central bank, the Reserve Bank of India, stated that in case an ATM runs out of cash for more than 10 hours, the bank has to pay over $180 as a fine, which could eventually lead to the ATMs shutting shop.
Thankfully for Findi, the ATMs deployed seem to be at a safe distance from such problems. The installed ATMs continue to show strong transaction trends, with ATMs in place longer than 90 days averaging over 100 transactions per day per ATM.
Poring over the progress of the CBI contract, now, there are over 1,000 sites live and transacting, 1,000 sites approved by the CBI, and 550 sites awaiting approval by the CBI. Overall, this contract remains on track to usher in revenue of $25 to 30 million per year, and an annual EBITDA of $11-$13 million.
The CBI contract along with the State Bank of India contract extension have positioned the Company for success. Sharing updated profit guidance with shareholders, Findi noted its new revenue guidance of $51-53 million (an increase of up to 13% on the original guidance), and EBITDA of $14.5-15.5 million (an increase of up to 19%) for this financial year.
Alinda is a Business Reporter for The Sentiment
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