Du says new FinTech service doing 'better than expected'

Dubai telecoms operator du's first financial technology service has performed better than expected, which in turn will help the company boost its operations, its chief executive has said.

The uptake for Du Pay, which was launched in April, was "better than our initial projections", Fahad Al Hassawi told The National on Monday.

The three-month-old platform is "addressing a very big need in the market", he said in an interview.

Du Pay offers a range of financial services, including domestic and international transfers, bill payments and recharging, cash-in and cash-out services, and receiving salary through a unique Iban number, among others.

"Against projections, it's far, far better than what we anticipated. We have seen a very strong adoption from the market ... [in terms of] the number of remittance transactions and its total amount," said Mr Al Hassawi, who declined to provide subscriber and remittance data for du Pay.

Micro loans on du Pay, which were announced in April, are on track for its 2025 launch, as the company continues to streamline partnerships and regulatory compliance.

"We're sticking to the same plans. Doing loans requires us to find the right partners with the right licences. I don't think we will be ahead of that plan," Mr Al Hassawi said.

The service will allow du, or Emirates Integrated Telecommunications Company, to tap into the increasing use of mobile platforms to gain access to financial services with the use of digital wallets and online payments platforms.

The telecom operator is also open to adding cryptocurrency and investment tools to du Pay, the unit's chief executive Nicolas Levi previously told The National.

Du has been stepping up efforts to grow its customer base and compete in a telecoms environment, where new technology is being integrated as consumers seek faster connectivity on the go.

Following the du Pay launch, in May it unveiled du Smart Car, which provides internet services in vehicles. Subscriber numbers for the new service were also unavailable.

The company's expansion into other segments comes amid growing profitability on the back of the UAE's strong macro-economic environment.

Net profit attributable to shareholders in the three months ending in June rose 46 per cent annually to Dh581 million ($158.2 million), it said on Monday in a regulatory filing to the Dubai Financial Market, where its shares trade.

The company's board of directors approved the distribution of an interim cash dividend of Dh0.20 per share, a 53.8 per cent jump on Dh0.13 last year.

Du's "very strong" performance "directly translated into the growth of the dividend ... which is a very, very positive message to our shareholders", Mr Al Hassawi said.

Revenue climbed 7.3 per cent to more than Dh3.59 billion, while earnings before interest, taxes, depreciation and amortisation grew 3.2 per cent to Dh1.57 billion.

For the first half of 2024, du's net profit soared more than 54 per cent year-on-year to Dh1.18 billion, while revenue rose 5.7 per cent to Dh7.17 billion.

The company's mobile subscriber base rose 2.9 per cent annually to 8.2 million, while its fixed-base customers jumped nearly 13 per cent to 630,000.

Du shares settled 0.34 per cent higher at Dh5.99 on Monday. They are up more than 15 per cent so far in 2024.

The company expects the continued rise of the UAE's population and its economy to remain drivers of its business, Mr Al Hassawi said.

"Growth in the population typically translates to growth in the telecom industry and market, [which means] more business for us," he said.