Someone's definitely laughing 
Accelerated uptake of its BNPL offering has seen IOUpay achieve growth in its total transaction volume in the March quarter amid consistent momentum.
Malaysia-focused, Aussie fintech IOUpay (ASX:IOU) has reported total transaction values (TTV) of ~$11 million for Q3 FY22 delivering ~$560k in net transaction revenues (NTR).
A significant increase in BNPL activity during the first half of the March quarter contributed to the elevated TTV.
In the financial year-to-date, IOUpay has written TTV of more than $23 million, delivering NTR of ~$1.62 million.
The company has positive adjusted net operating cashflow for the second consecutive quarter of $1.33 million.
Non-performing loans (NPL) of ~$39k and an NPL ratio of 0.16% indicates modest delinquencies, reinforcing the company’s strong credit quality focus.
The underlying BNPL business is generating positive cashflow from a growing portfolio of receivables that continues to reveal strong credit quality with low NPL metrics.
The Company’s strategy of focusing on relationships with quality partners who manage large communities of creditworthy consumers, and writing profitable underlying transactions, is showing results as it pursues a positive bottom line.
Growth in sign ups follows myIOU 2.0 launch
IOUpay has experienced continued growth in consumer and merchant sign ups since the launch of its flagship myIOU BNPL in June 2021.
Consumer engagement metrics continue a steady growth trend with an uptick following the myIOU 2.0 App launch in March.
The enhanced App has a refined interface and easier navigation. IOUpay appointed celebrated Hong Kong actress and television host Priscilla Wong, and local star Syafiq Kyle as the new faces of myIOU for 2022.
The company now has 3,443 merchant outlets onboarded, up 15% while almost 2000, new merchant outlets are activated and listed on myIOU, up 30% in the quarter.
There have been 68,224 consumer downloads of myIOU, up 73% in Q3 and 20,302 consumer activated accounts, up 85%.
During the March quarter, 124 new merchants operating 380 outlets around Malaysia were added to the myIOU platform.
New merchants were added to 12 industry vertical categories including electronics & gadgets, beauty & wellness, automotive, fashion, along with home & living.
Notable businesses amongst these new merchant relationships include: Arissto (Malaysia) Sdn Bhd, Best Point Electrical Chain Store Sdn Bhd, Cavenzi Design Sdn Bhd, Healthy World Lifestyle Sdn Bhd t/as Ogawa Malaysia, Kemudi Timur Elektronik, Lazo Diamond and Weng Kwong Jewellery.
Additionally, IOUpay’s merchant services teams deployed the myIOU offering to a further 92 outlets relating to existing merchant relationships established in prior periods. These included an additional 51 Wah Chan outlets and 11 Baloy outlets.
SOGO department stores new signing
During the March quarter, IOUpay entered into a Merchant Agreement with SOGO (K.L.) Departmental Store Sdn Bhd (SOGO).
SOGO is one of Malaysia’s leading retailers, operating three properties in key commercial districts in Kuala Lumpur, Selangor and Johor with total retail floor space of 100,000 square metres.
The original landmark Kuala Lumpur property represents 60,000 square metres of retail space with SOGO the sole occupant.
The Selangor and Johor properties are integrated shopping malls in which SOGO is the anchor tenant.
myIOU BNPL services will be offered at SOGO’s department stores on both point-of-sale (POS) and e-commerce payment platforms.
Integration, testing and rollout will be in two phases, with myIOU forecasted to be launched on SOGO’s POS platform for instore purchases by the end of the June quarter.
In the second phase, myIOU is forecasted to go live on SOGO’s e-commerce platform for online purchases during the September quarter.
Razer in full implementation
IOUpay now has ~300 Razer merchants approved, making myIOU available as a payment option to those merchants’ consumer customers.
The company approved more than 140 for onboarding by RMS from their first batch of merchants offered for review in the December quarter.
During the March quarter 150 merchants was also approved by IOUpay and onboarded by RMS to its payment platform.
RMS is currently compiling a third batch of merchants for review, based upon IOUpay’s industry vertical preferences and minimum transaction value expectations.
The Company is conducting monthly training of sales staff to ensure optimal signup rates.
IOUpay gets IDSB dividend boost
In September 2021, IOUpay announced it would acquire 42% of Malaysian company I.Destinasi Sdn Bhd (IDSB), in a deal worth 126 million ringgit (or ~A$41.3m at the exchange rate of the time).
IDSB is a specialised finance company focusing on providing instalment-based consumer credit services to civil servants for, and on behalf of Malaysian banks.
The company received dividends during the March quarter based on its current 21% shareholding. Those two dividends total ~AUD$533k.
The company announced last month the completion of the first tranche payment of RM63 million (~A$21 million). The second tranche is expected to be completed in the June quarter and will double the company’s shareholding, and so also its share of any future dividend distributions.
IOUpay has been working closely with IDSB management to establish reporting protocols, build operational interaction and develop inter-company staff working relationships.
A pilot program is being developed to market myIOU BNPL services into IDSB’s high credit quality, civil servant customer base.
