Data Science. Credit Scoring. Digital Finance - ID Finance
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Data Science. Credit Scoring. Digital Finance
TOP-2 TOP-50 BEST ALTERNATIVE
INNOVATION BEST LENDING EUROPE TOP 100:
FASTEST GROWING FINTECH FASTEST GROWING FINANCE COMPANY
LEADER PLATFORM WINNER «FINANCE»
COMPANY IN EUROPE COMPANY IN EUROPE
BIG INNOVATION BENZINGA GLOBAL FINANCIAL TIMES INC. 5000 EUROPE EUROPEAN FINTECH RED HERRING
AWARD FINTECH AWARDS PUBLIC AWARDS
2017 2017 April 2018 March 2018 2016 2016
ID FINANCE
MISSION
INTERNATIONAL
CONSUMER FINANCE PROVIDER
DATA-DRIVEN
1 Fully in-house IT & risk
Build an international data-driven financial management system
institution to provide convenient financial
PRODUCT
services 2 Tailored to meet consumer needs
driving high client retention
RISK CONTROL
3 Compliance with all regulatory
requirements across the group
INTERNATIONAL EXPERTISE
4 Scalable business model
ID Finance Overview
LEADING INTERNATIONAL FINTECH COMPANY
9 countries
c. 5m clients
STRATEGY
Scalability $100+ m net income in
New businesses are launched less
than in 3 months 2021
Client retention
Loyal recurring customers drive
bottom line results
Growth 221% in net loan
portfolio (Q1 2014 vs. Q1 2018)
3
ID Finance Overview
LEADING INTERNATIONAL FINTECH COMPANY
Innovative Digital Finance (ID Finance) Global expansion and unique registered clients
CO 2018 Current presence Strategic focus
Founded: 2012 5.3m
Employees: 600 MX 2017
Key facts
Geographic presence: 9 countries BR 2016
Products: consumer finance provider PL 2015
ES 2015 (HQ)
GE 2014
Build an international data-driven financial KZ 2014
Mission institution to provide financial services to the BL 2012 (R&D hub)
underbanked
RU 2012
Sep-12 Feb-13 Jul-13 Dec-13 May-14 Oct-14 Mar-15 Aug-15 Jan-16 Jun-16 Nov-16 Apr-17 Sep-17 Feb-18
Scalable model: launch in new geography Financial highlights
within 3 months
Exceptional traction: net loan portfolio grew $152m
at 221% CAGR Q1 2014 – Q1 2018
$107m
2 199
High client loyalty: 90% of new clients
$66m
generate repeat business.
1 624
Investment $39m
High Return on Marketing Investment:
highlights $4.4 cash net income from $1 invested into $18m 1 137 1 112
CAC
$6.5m 803
717
High ROAE: 43% in 2017FY $5.0m 558
421 366
High profitability: $100+m of net profit 197 122 232
92 62
expected in 2021+
Technology and data driven: Proprietary 2016 2017 2018F 2019F 2020F 2021F 2022F
scoring model and in-house IT platform Issuance ($m) Revenue ($m) Profit after tax
4
Our History
RAPID GROWTH DUE TO EFFECTIVE SCALING STRATEGY
Loan issuance dynamics
2012 2013 2014 2015 2016 2017
$ 0.2m $1.7m $ 14m $36m $92m $197m
Launch and risk optimisation CIS expansion European expansion LATAM expansion
Russia Georgia Spain Brazil, Mexico
Scoring and risk-management Kazakhstan Poland New products:
Round A: $3.5m Installment loans Round B: $6.0m AmmoPay and Solva
Major factors for effective scaling
Professional and motivated Centralised IT and risk- Monitoring of key indicators in
global and local teams infrastructure real time
5Product Portfolio
OUR PRODUCTS TARGET UNDERBANKED CUSTOMERS
High margin
Minimum
Target lending market margin given
borrower risk
Banks’
maximum
margin
Banks’ target
lending market
Low margin
Low risk Medium risk High risk
6Highly Efficient IT & Risk-management System
ID FINANCE CONTROLS THE ENTIRE CUSTOMER JOURNEY THROUGH HIGHLY EFFICIENT RISK MANAGEMENT
Risk management present at every step of client life cycle ID Finance taps into global and local pools of information
Client acquisition
Fraud prevention Scoring and fraud-analysis
Legal support Client management
CLIENT LIFE CYCLE
Collections Pre-collections
10,000+ 98% 70% 90%
Data points are collected and Applications are processed Of the debt recovery achieved Of clients become loyal
analyzed in real time automatically in-house through efficient client customers through
management system effective CRM system
7Strong Management Team
GLOBAL TEAM OF SPECIALISED FINANCIAL SERVICES EXPERTS
Boris Batin, PhD Alexander Dunaev, CFA Javier Lopez
Co-founder, Chief Executive Officer (CEO) Co-founder, Chief Operational Officer (COO) Chief Financial Officer (CFO)
15+ years of work experience in banking and finance 10+ years of experience in banking and finance 19+ years of experience in financial services and finance
Previously held various positions at Deutsche Bank, Previous experience: Deutsche Bank, London Previous experience in General Electric and Standard
Renaissance Capital and RBS within debt capital markets in
Holds Chartered Financial Analyst degree Chartered Bank
London and Moscow
Graduated from Imperial College with a degree of Master in Graduated from ESADE University (Barcelona, Spain) with a
Graduated from Cambridge University with a degree of
Finance degree of Master in Business Administration
Master in Economics
Ekaterina Kazak Alessandro Ceschel Pavel Shareyko
Chief Risk Officer (CRO) Chief Marketing Officer (CMO) Chief Technical Officer (CTO)
10 years of work experience in risk management 11 years of professional experience in Digital Marketing and 13 years of experience in software development, including
international IT Projects development of high-load applications and financial
Previously worked as Head of Russia & CIS Experian
systems
Analytics Previously successfully developed online internet
businesses B2C, B2B and P2P in Spain – Ulabox, Previous experience: Lead developer at Itransition
Graduated from Moscow State University of Economics,
Logismarket, Socialcar, worked in MNC (Nestlé) and in early
Statistics and Informatics Graduated from Belorussian State University
stage startups
Graduated from Padova University with a Master in
Industrial Engineering and Business Administration
8Client Acquisition Funnel
HIGHLY EFFECTIVE CLIENT ACQUISITION AND RETENTION STRATEGY
Conversion rates
2017 FY 2016 FY Historical data
for 2017
10,0
26m 21m Website visitors, #m
9%
8,0
Website 6,0
visitors
4,0
Conversion rate to 2,0
applications increased by 1pp Conversion to 0,0
(Y-o-Y) applications Q1 2014 Q3 2014 Q1 2015 Q3 2015 Q1 2016 Q3 2016 Q1 2017 Q3 2017
1,0
2.5m 1.8m Applications, #m
33%
0,8
0,6
Applications 0,4
0,2
Approval rate has increased 0,0
by 7pp (Y-o-Y) Approval rate Q1 2014 Q3 2014 Q1 2015 Q3 2015 Q1 2016 Q3 2016 Q1 2017 Q3 2017
300
Number 800k 460k Number of loans issued, #k
90% 200
of loans 100
issued Conversion rate from visits to
loans issued has reached 3.1% 0
Retention rate Q1 2014 Q3 2014 Q1 2015 Q3 2015 Q1 2016 Q3 2016 Q1 2017 Q3 2017
(+1pp Y-o-Y)
80
Amount of loans issued, $m
$197m $92m 5% 60
Amount of 40
loans issued 20
Marketing cost has decreased Loan marketing 0
Q1 2014 Q3 2014 Q1 2015 Q3 2015 Q1 2016 Q3 2016 Q1 2017 Q3 2017
by 1.8pp (Y-o-Y) cost*
* Marketing costs divided by amount issued 9Portfolio Growth
SIGNIFICANT PORTFOLIO DIVERSIFICATION ACHIEVED IN LINE WITH GROUP STRATEGY
Value of loans outstanding (net of reserves), by country ($m)
120
100
96,1
77,3
80
57,4
60
39,0
40
22,8
20 11,8
3,3 5,8
1,0
0
1H 2014 2H 2014 1H 2015 2H 2015 1H 2016 2H 2016 1H 2017 2H 2017 Q1 2018
Value of loans outstanding (net of reserves), by country ($m)
December 2014 December 2016 March 2018
2%
3%
13% 6% 9%
10% 13%
24% 43%
$3.3m 49% $39m $96m
11%
77%
18% 22%
Russia Kazakhstan Georgia Spain Poland Brazil Mexico
10Portfolio Quality
ID FINANCE SIGNIFICANTLY REDUCED NPL WHILST ACHIEVING RAPID GROWTH
Historical NPL* rates
50%
43,3% Significant portfolio quality
45%
improvement
40%
35%
30%
25%
23,5%
20%
14,6%
15% 12,1% 11,2% 10,6%
9,7% 10,1% 10,1% 8,8%
10% 7,2%
5%
0%
H1 2013 H2 2013 H1 2014 H2 2014 H1 2015 H2 2015 H1 2016 H2 2016 H1 2017 H2 2017 Q1 2018
Historical group level of NPL*
450
400 $30m
350
$16.5m
300
250
$417m
200
$386m
150 $193m $176m
100
50
0
Loans issued since launch NPL as of Mar-18 Repaid and performing loans Mar-18
* NPL = FPR 90d+ 11Geographical Expansion
STRATEGY FOCUSED ON ENTRY INTO SELECTED HIGH GROWTH MARKETS
Launch Population* (m) Internet users* (m) Mobile users* (m)
Russia 2012 144 103 103
Kazakhstan 2014 18 10 15
Georgia 2014 4 2 3
Spain 2015 46 37 40
Poland 2015 38 27 27
Brazil 2016 208 123 130
Mexico 2017 127 73 86
Colombia 2018 48 27 33
USA 2019 321 239 258
Peru 2019 31 13 19
Current presence Strategic focus
Total 985 653 714
Country of presence ID Finance
Geographic diversification 2013-2021. Loans issued
2013 FY 2017 FY E 2021 FY
100% 1% 3%
79% 20%
23%
Share of Share of Share of
European European 41% European
and LatAm and LatAm and LatAm
0% 21% 59%
33%
Russia and CIS Europe Americas Other region (Asia/India…)
* 2015 WorldBank, UNdata, eMarketer; 2016 Statista, Budde 12Product Diversification
FOCUS SHIFTING TOWARDS LONGER-TERM PRODUCTS AND MORE AFFORDABLE LOANS
Strategy focus
Focus on Larger market
Longer term
prime users capacity
Client profile Market size Loan term
Larger volume Lower risk % Lower rates
Loan volume NPL level Competitive
advantage
Product diversification 2013-2021. Loans issued
2013 FY 2017 FY E 2021 FY
100% 57% 43% 19% 81%
Share of Share of
Share of
long-term long-term
long-term
loans loans
loans 0%
43% 81%
Single payment loans Instalment loans
13Funding Strategy
FUNDING LATAM AND LONGER-TERM PRODUCT EXPANSION
Funding highlights Debt portfolio (Q1 2018). Currency breakdown
FX risk is mitigated by introducing local funding:
GEL
RU, KZ, GE, ES are self-funded; Debt portfolio is well-
5% diversified in terms of
MXN, BRL, PLN funding will be launched in 2018 EUR currency
Liquidity risk is mitigated by introducing different sources of funding: 18%
Mintos will be introduced in Poland; RUB
Bank funding will be introduced in Brazil after obtaining $95.4m 50%
license
USD
Key drivers of funding cost decrease: 27%
Scale of operations;
Credit ratings
IFRS audited statements
Debt repayment schedule ($m) Debt portfolio (Q1 2018). Source breakdown
1 200
Debt portfolio is well-balanced in terms of
maturity.
1 000 961 The latest scheduled payment is in Q1 2021
9%
7% Credit funds
800
702 700
Individual investors
600
575
516 507
568
515 $95.4m 50%
421
Mintos
400 34% Bonds
200
0 0 12
0
Q2 2018 Q3 2018 Q4 2018 Q1 2019 Q2 2019 Q3 2019 Q4 2019 Q1 2020 Q2 2020 Q3 2020 Q4 2020 Q1 2021
14Boris Batin
Co-founder, CEO @ ID Finance
Boris.batin@idfinance.com
Thank you!
Alexander Dunaev
Co-founder, COO @ ID Finance
Alexander.dunaev@idfinance.com
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