GHL System Berhad Annual Report 2018

a n n u a l r e p o r t 2 0 1 8 17 5. FUTURE PROSPECTS The Group continues to focus on merchant acquisition across the three markets namely Malaysia, Philippines and Thailand by offering our clients, payments options ranging from credit/debit acceptance, e-wallets, mobile payments as well as internet payments. 2017 saw Malaysia commenced payment acceptance of a China based e-wallet with the Philippines following closely in 2018. The emergence of QR based e-wallets have spurned growth of domestic e-wallet players in all three markets and 2018 saw the launch of several local players in this space. This bodes well for GHL, as it increases our competitive edge in offering our merchants an integrated omni-channel payment solution. The Group in 2018 partnered with a major Malaysian domestic bank to enable its existing EDC terminal base to capture all six (6) e-wallets that are currently available in the Malaysian market. This trend will be replicated across Philippines and Thailand where similar plans to partner with the domestic banks to enable the same is expected to happen in 2019. The Group remains optimistic of further developing TPA as a key growth engine for the Group given the changes in the payment landscape as e-payments gain further traction as driven by not only regulatory directives, growing market acceptance, but also positive changes in consumer preferences towards e-payments. However, part of this fast changing landscape also includes competitive pressures which will impact profit margins and hence the group needs to remain agile and adaptable to react quickly. In 4Q18, the Group expanded to Cambodia with the acquisition of a 51% stake in Speed Pay PLC and this marks the Group’s expansion into another ASEAN region. 2019 will also see the Group continuing to explore additional expansion in ASEAN. Although TPA is a key focus, the Group recognises that the payment infrastructure within the markets it operates in remains under developed. Opportunities remain in the traditional space of EDC hardware sales and payment network infrastructure and GHL remains well positioned to capitalise on this growth area. The growth outlook for 2019 and beyond remains optimistic for e-payments given the high unbanked segment, continued high cash usage and central bank policies which are aligned in promoting greater use of non-cash methods for payments. MANAGEMENT D I SCUSS I ON AND ANA LYS I S C O N T ’ D