Annual report 2014
17
This TPAcardpayment services business is relativelynew
and other than a minor TPA deployment in Thailand, it
has not yet been deployed in our major markets. The
existing GHL TPA data as shown in Figure 6 comprises
of the following activities (listed in order of size) ; (i)
Various revenue sharing arrangements under direct
contracts with merchants and banks in Malaysia and
Philippines (From 2008 to 2013) (ii) Malaysian domestic
debit card (“MyDebit”) merchant acquisition (since
2003) (iii) Internet TPA (“eGHL”) in Malaysia (Since 2Q
2014) and Thailand (2013), and (iv) “Card Present” TPA
(i.e. non-internet TPA) in Thailand (Since 2Q 2014).
Given the size of the opportunity and the push of
most central banks to replace cash payments with
electronic payments, the TPA card payments services
promises significant opportunity for future growth. For
this reason, TPA is a key element of our growth strategy
for the immediate years ahead. The Revenue/
Transaction Value % grew strongly due to increased
merchant acquisition activity. The Margin/Transaction
Value % declined marginally due to the replacement
of existing POS terminals in Malaysia necessitated by
changes in card association security standards. Figure
6 shows the key data for this business as it presently
stands. It excludes card present activities in Malaysia
and Philippines which we expect to implement in
2015.
GHL TPA only (Figure 6)
(All stated in RM’
Millions unless stated
otherwise)
2013
2014
%
change
Transaction Value
Processed
1,148.6 1,349.6
17.5%
Gross Revenue
12.3
19.6
60.0%
Revenue/Transaction
Value*
1.1%
1.5%
36.4%
Gross Margin
9.3
10.1
9.6%
Margin/Transaction
Value*
0.8%
0.8%
-7.4%
Number of Merchant
Acceptance Points
(Thousands)
27.5
37.2
34.8%
* Gross Revenue or Gross Margin respectively divided by
the Transaction Value Processed expressed as a %
Going Forward
The payments industry is an exciting one that is
changing rapidly. There have been changes in
technology and innovative new products have
been created by banks and increasingly, non-
bank companies with deep insights into consumer
behaviour. Such developments continue to cause
fundamental paradigm shifts in terms of what it takes
to execute a retail payment.
GHL is primarily a merchant acquirer and a bank
solutions partner with deep strengths in the underlying
technology. Through e-pay, we also serve the
consumer segment for various reload and collections
services. These strengths position us well to deal with
the changing environment ahead. We have, through
our regional development teams, the capability to
adapt technology and hardware to fit needs as they
evolve. We can adapt.
I thank you shareholders for your investment in GHL
and your ongoing support of the management team.
I also thank the people of GHL whose passion and
dedication for excellence has made possible our
journey, thus far.
As I look forward, I ammore excited than ever to be at
the helm of GHL Group. With our TPA business about
to grow, I believe that the next decade will be even
more exciting for GHL.
Raj Lorenz
Group CEO, GHL Systems Berhad
ceo
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