Geidea Egypt aims to pump more than EGP 600m in investments in Egypt within two years, coinciding with an ambitious plan to deploy about 80,000 points of sale (POS) by the end of this year.
Ahmed Nader — Geidea Egypt’s Regional General Manager — said in an interview with Daily News Egypt that the company has already deployed about 20,000 POSs during the first quarter (1Q) of 2022, and is currently dealing with about 500 merchants, adding that it aims to raise the number of electronic merchants to about 2,000 by 2023.
Furthermore, he said that Geidea obtained licenses to facilitate payments for the National Bank of Egypt (NBE) and Banque Misr in addition to obtaining a contactless payment by mobile phone license in Egypt based on its success in the Saudi market, through which it deals with more than 10,000 merchants using the feature.
Nader also said that the company established a huge information data centre at a cost of more than EGP 80m, pointing out that it achieved a business volume of about EGP 200m in March only — before adding bill payments services and other services to meet the merchant’s needs.
How was the Geidea Technology Group established and how did it become one of the largest digital payment companies in the Arab region, starting with its leadership in the Saudi market?
Geidea Technology is a Saudi company of origin since 2008, and it owns 75% of the market share of payments in the Saudi market, with 700,000 POSs in the market. In 2018, Gulf Capital acquired Geidea Technology, which is one of the largest funds in the Gulf with assets of about $2.5bn.
Gulf Capital’s goal is to support Geidea’s plans to expand, and these plans will start in the Egyptian and UAE markets. The company is looking forward to covering all Arabian Gulf countries by the end of 2022.
We have actually started negotiations with a number of Gulf countries and are targeting expansion in parts of Africa in 2023 as well.
The UAE market was the gateway to the spread of the company’s services in the Gulf’s markets, and Egypt will also become a centre for launching into the African and North African markets.
The entry of Gulf Capital within the ownership structure of Geidea Technology contributes to increasing investments and attracting the best cadres from around the world.
When did Geidea begin planning breaking into the Egyptian market? What has the process been like?
The company actually started its work in the Egyptian market in May 2021 after obtaining licenses and bank contracts and team building, and the first payments process for our customers in Egypt was carried out in January 2022.
The company also appointed a large number of employees — 500, to be specific.
During 1Q of this year, the company distributed 20,000 POSs, and we aim to close this year by increasing that number to 80,000. It also deals with 500 online merchants.
The company also aims to reach 1,200 e-merchants by the end of this year and increase the number of employees to more than 1,000 employees by the end of this year.
Furthermore, Geidea obtained licenses to facilitate payments in cooperation with both the NBE and Banque Misr in terms of POSs and e-commerce.
What is the company’s expansion plan after obtaining the contactless payment license?
The company has great experiences and expertise in dealing with the contactless payment mechanism through mobile phones in the Saudi market. We aim to transfer it to the Egyptian market in a way that enhances the benefits of joint investments between the two countries. We are also constantly working on workshops between the Saudi, Egyptian, and UAE teams to exchange experiences.
The volume of contracts in this regard reached 10,000 merchants.
Additionally, the company’s experience in the field of contactless payment by mobile phone prompted it to cooperate with the NBE and Banque Misr in transferring its expertise in the field of contactless payment by mobile phone in the Saudi market to bring about a technological revolution in the Egyptian market.
The company is also preparing in the coming months to expand to launch a new service in cooperation with Visa Corporation.
What is contactless payment?
We are moving in Egypt very strongly towards cashless transactions. Contactless payment licenses via mobile phone and QR code will contribute to a huge boom for the digital financial transformation in Egypt so that the company can spread very quickly and anywhere due to its reliance on the existing mobile phone.
This new system will spread widely in remote areas and with small traders and sellers all over Egypt because it is inexpensive and depends only on downloading the service application on the mobile phone, and it will spread widely in the delivery services of goods and products so that representatives do not need to collect cash money and bear the risks and expenses of transferring it to the company.
Initially, this service will only process transactions less than EGP 600. In its second stage, however, the limit should be increased after obtaining the approval of the Central Bank of Egypt (CBE).
What is your opinion of the competition in the digital payments sector?
Most companies in the Egyptian market started through the mechanism of accepting bill payments, and then began to switch to a system of accepting payments in its various forms through payment facilitation licenses to accept bank card payments for any purchases on POS devices. The Egyptian market will soon transition fully to cashless payments through phones, wallets, QR codes, or bank cards — all services provided by Geidea.
Bill payment services also represent additional services that the company will provide, but the main trend from the beginning is to accept payments in all its forms among all citizens; and therefore, we deal with large- and medium-sized merchants primarily. Eventually, we will cover all categories of merchants within three or four years and expand to about 400,000 POSs.
The company also accepts payments for all retail, financing, and instalment companies — including Contact Financial, ValU, and other companies — as well as a wide range of services required by the customer.
Furthermore, we aim to become leaders in the Egyptian market in payments in general, and that competitiveness will contribute to increasing the level of services in the market in general.
The company’s total investments in the Egyptian market since its inception amounted to about EGP 400m, and we aim to increase these investments to more than EGP 600m within two years.
What are the challenges in the Egyptian market?
The challenges in the Egyptian market are natural, including facing competitors and the strength of competition from payment companies of various categories and levels to all customers and citizens everywhere.
Furthermore, Egyptian banks fully welcome the company’s presence in the market and have been taking initiative to cooperate with Geidea beyond our expectations.
Additionally, the Egyptian market witnessed a great boom in the technological market, because the banking sector is always looking for balance and revitalisation of the market led by the CBE.
As for government transactions and procedures, they were very easy and fast, as the company obtained its first license in less than three months since the application was submitted and operation began.