AWelcome to Boku's 2025 Capital Markets event. It's actually pretty humbling standing here and seeing how many people have come to listen to what we have to say this afternoon. So thank you for giving up your time. I know people have traveled, and, you know, we do appreciate it, and, you know, you find us at a really exciting time in the company's evolution. I think I know most people have seen you as you come in, but for those of you that don't know me, I'm Stuart, and I've been CEO of the company since January last year, and, you know, we're really excited to get the opportunity over the next couple of hours to walk you through what we see as the enormous growth potential in Boku.
It's at a time when the company is both performing and transforming, performing in that we are delivering top-line revenue growth of 20% or above at the same time as delivering profitability north of 30%. My simple math that puts us at a Rule of 50 company for those of you that are interested in those such things. We're also transforming. What you will hear from the team over the next hour or so is that we are facing into what we believe is an enormous market opportunity and that we are building the scalable organization in order to deliver. Today's not really going to be about me standing up and talking at you. You get enough of that during the normal course of business. Today's an opportunity for you to hear from some of the other talented executives that are really pushing Boku forward.
So we will hear about our products. We will hear about the new initiatives and innovations that we're bringing to market. And you will hear about how we are delivering that within the organizational framework. And then for those of you that just can't wait, Rob will tie it all up in a bow at the end, and you'll get to hear about the wonderful world of take rates and TPV as we look forward to our future financial shape and how all of this growth transpires in the numbers. So let's get into it. Beyond plastic. So for those of us in the room and maybe some people on the webcast, we are, I have no doubt, walking around all of us with numerous bits of plastic in our coat pockets.
But can anyone tell me when, and this one's not for Jon Prideaux, by the way, can anyone tell me when the first plastic card was actually issued? Hazard a guess. It was actually in the 1940s. It actually predates Visa and Mastercard. Plastic, we're all still carrying this stuff around, has been technology that is over 70 years old. And does anyone know when the first card acceptance terminal was first issued? A lot of shaking of heads. It was actually in the late 1970s. So the way that we pay for things, we walk into the store, we get our piece of plastic out, we put it in the machine. That's 50-year-old technology. It's very hard to think about in other industries where 50-year-old technology still exists, but it does in payments.
Something actually happened in 2007 that changed the nature of commerce and subsequently the nature of payments all in one go. Does anyone know what that is? We need to work on this audience participation thing, guys. It's these things. The smartphone. Immediately, the smartphone changed the way that commerce happens all around the world. People are now consuming products via their phones through app ecosystems. And with that came a need to evolve payments alongside it. So commerce has gone mobile, and payments therefore needed to follow. And so the world of the local payment methods was born. Put very simply, local payment methods is a way of describing a payment method that has evolved and is the most popular way people like to pay within their given country.
They are typically mobile-centric or mobile native, but they're designed very much to serve a domestic purpose. The types of local payment method that we're aggregating on the Boku network include Direct Carrier Billing, those of you that have supported us for a while will be familiar with DCB as our flagship product. That's evolved into digital wallets, particularly popular when it sits behind an app ecosystem, and then more recently, the big transformational evolution in payments is turning into what we call account- to- account, and you'll be hearing a lot about these payment methods as we go through the presentation. Let me give you a sense of the scale of the growth in local payment methods around the world. This year in 2025, local payment methods overtook cards as a means of payment online. That's profound.
What took Visa and Mastercard over 50 years to achieve has happened in less than 20 years on local payment methods. Think about that. It's all started really in Asia Pacific. So products like Alipay in China, which has over 1.4 billion consumers using Alipay. This is not just an Asia Pacific phenomenon, though. It's now coming into Europe. Products like BLIK, which has 20 million users in Poland. These are not small incidental payment methods. Many of these organizations are fully-fledged fintechs in their own right. GCash in the Philippines, for example, you may have read, has been toying with the idea of an IPO. I suspect not in London. Sorry, guys, but you never know. But GCash is thinking of IPOing at a $5 billion valuation. So each of these local payment methods is a potential unicorn in its own right.
These changes are absolutely profound. It's not a static picture. As I said, in 2023, LPMs were sub-50% of all global e-commerce traffic. By 2028, they will be almost 60%. So this is a long-term and ongoing growing trend. There's also some displacement happening here. The role of the credit card and debit card is now being displaced, and those roles are being replaced by new mobile-centric products that have taken their place. You can see it from this chart. Credit cards, they're having their share eaten now by products like Buy Now Pay Later. You may have heard of Klarna or Affirm or Afterpay. And also by Direct Carrier Billing, which is actually a form of credit given to consumers by their mobile operators.
Debit cards, a lot of the traffic that was formerly going through a debit card product has now migrated onto the mobile, is now happening through some kind of digital wallet. And then increasingly, a really profound shift is that cash, the cash economy, is now moving onto the mobile and moving into the world of LPMs through what we're calling account- to-a ccount. And you're gonna hear a lot more about this as we go through the presentation. Why is this happening now? I point to three macro tailwinds that are driving this behavior. The main one being consumers want to use LPMs. They want to live their lives via their mobile device. They want to be able to consume products using their favorite local payment method. And these payment methods are dynamic. They can communicate. They can send offers and discounts.
They can allow consumers to take advantage of mobile commerce so the main driver of LPM popularity is really consumers themselves. This is also being supported around the world by central banks. First and foremost, they want to bring more and more of their population into the digital world. It's about digital inclusivity, but there's also a geopolitical aspect to it. You know, when thinking about setting up or growing a payment rail domestically, central banks think about owning those rails themselves and not allowing big American corporations to come in and take that space, and so there is a push from central banks to own payment rails, and then finally, what's in it for the merchants? For 50 years, the merchants have had a choice of two in where they go for payments. They can go to Visa or they can go to Mastercard.
And they get no right to negotiate interchange fees. They're dictated on a multilateral basis. And so finally, with local payment methods, merchants get to negotiate terms. They get to prove to win value for the share that they bring, and they get to own the experience that the consumer receives. And so it's really all about choice for the merchants as well. So what's the problem, I hear you say? Well, the main one is there are hundreds of local payment methods around the world. They're disaggregated. They're not on any network. And therefore, how do you access hundreds of local payment methods? It's impossible to do it on your own. And it's not like our customers have armies of engineers sitting around waiting for projects. You know, most of our customers want their engineers building products, not connecting to payment methods.
Then finally, the payment methods themselves were primarily built to serve a domestic purpose. They weren't built with international commerce in mind. That's where Boku comes in. Put very simply and very deliberately, our mission is to simplify global expansion for our merchants by providing seamless access to the world's most popular payment methods. I'm just gonna show another short video to explain in a bit more detail.
Boku brings local payment methods together on a single platform: Direct Carrier Billing, digital wallets, and account- to- account bank transfers. Let's take a look. Direct Carrier Billing lets consumers pay securely with just a mobile phone number. The amount spent is charged to their monthly phone bill and is a form of microcredit, just like Buy Now Pay Later. Digital wallets allow a consumer to make payments using a pre-funded balance.
Often, wallets are embedded in broader super app ecosystems that offer secure checkout, loyalty programs, and promotions to capture and engage new customers. account- to-a ccount payment methods enable instant, secure, low-cost bank transfers. These are the fastest-growing regulated alternatives to wires and cards and are redefining cross-border payments. With market leadership and local payment methods, Boku connects merchants to billions of consumers. Boku, the future of payments, is local.
So look, put very, very simply, we built a network that allows consumers around the world to buy from big global brands using their favorite local payment method, and for merchants, it means they can offer more payment choice to consumers in order to target and access up to 7 billion individual accounts around the world. That is what we do. That is the essence of what Boku brings.
A quick snapshot of the network as it stands today. We currently have over 200 individual payment methods connected to the network, and that is servicing over 60 countries, and what I think is particularly, you know, impressive is that in any given month, over 100 million consumers make a transaction that goes across the Boku network, 100 million, and we're doing that around the world. We're not a regional player. Boku has always been a global business serving global merchants. We now span over 60 countries. We have staff in over 30 countries. You can see the purple dots on this slide denote where we have a hub of employees, but we actually have employees in over 30 countries. They are where our customers need us to be.
It's all because we are here trying to help our global merchants to expand their businesses way beyond they could if they only offered Visa and Mastercard as a method of payment. So how do we grow? There are three elements to our growth strategy as a business. First and foremost, we want to continue to add value for our existing customer base by helping them expand their reach around the world. It's about going wider. On top of that, we believe we've built a compelling network that is going to be attractive to the next wave of mega merchants. So it's about reselling this network to more and more potential customers. And that's really about going deeper. And then finally, it's about layering on top of the network more value-added services that can help solve more problems of global cross-border commerce for our merchants.
That's all about the value adds. How do we help our customers, existing customers, grow? Firstly, we have a set of payments products that Adam's going to talk to you about. That really helps our customers offer more payment choice to consumers, and that enables them to access a wider pool of potential customers for their businesses. That's how our payments products essentially help the merchants to grow. On top of that, we have a product that we call bundling. Bundling is really focused on helping those same merchants distribute their subscriptions to a wider pool of consumers. It's really a distribution product. Again, Adam's gonna talk to you in some detail about how this works shortly. Then finally, and more recently, we have a set of money movement capabilities that will help the merchants to collect their cash once transactions have been completed.
In terms of our sales approach, where do we go to find more merchants? So you'll be pleased to know that we're not going off-piste here. It's not about randomly selecting merchants and seeing what sticks. It's about taking what we've learned and the things that are of value to our existing merchants and going to the next cohort of merchants down from that, the sort of future tech stars, if you will, of the world, and offering them the same compelling proposition. I'm not gonna go into too much detail 'cause Mark's gonna cover this in his presentation. But it's essentially that community of people that are offering mobile native subscription-based recurring cross-border businesses, and that will be our growth strategy for new merchants, and then finally, this incredible opportunity in cross-border commerce.
Put simply, if we're going to connect a payment method for a merchant, very often in the cross-border world, that comes with the receipt of currency that the merchant just cannot use for various reasons. So finding effective and efficient ways to convert that money, first of all, collect it and convert it into the currency that the merchant wants, and then moving that money overseas is a real value add that we know that our merchants will want. Paul's gonna cover this in his presentation. Why do we think we're going to win? It's a competitive landscape, and you've seen the size of the market. Of course, that's going to suck in more competition. Let me just pick out a few points.
First and foremost, because we have worked with some of the world's biggest and most impressive organizations for the last 10-plus years, our technology is properly battle-hardened. These are the most demanding customers with very, very high standards, and the fact that we are trusted by them should tell you all you need to know about the quality of the products that we put into the market. Secondly, we're a truly global business. We've been a global business pretty much since day one. We're not a business with a kind of regional focus that does overseas markets. We are truly global. We're in over 60 countries. Not all of our competitors can say that. We have a unique set of assets that's continually evolving. We can offer tokenized payments over local payment methods. That's actually quite a unique capability. We have licenses to move money.
We have an extensive banking network, and we have legal entities that help us move those moneys in a way that is fully transparent and compliant. Again, this will be the focus of Paul's presentation, and then on top of all of that, we're not sitting still. We are continuing to innovate and find new ways to be increasingly useful to our customers, and you'll hear about products such as payment marketing as we go through the presentation, but of course, to achieve all of this ambition, there's a lot going on here, and we have big aspirations for the company that some of this does require a degree of organizational transformation. We are looking here to diversify the business, to broaden our revenue streams by offering more products to a bigger range of customers.
That requires a different organization with different technical and operational capabilities so that we can scale. We want to build a winning, scalable platform. And you're going to hear from Leila and Keegan about that in their presentations. And then finally, underlining all of that, you need a winning team. And I believe we have a winning team. And today's a great opportunity for you to hear from some of the other executives on the Boku leadership. So in summary, we have a very clear strategy, and we're executing it. We are performing 20%-plus revenue growth, 30%-plus EBITDA margins. And at the same time, we are leaning into what we believe is a material growth opportunity in the market. So before I move it on, let's just have a quick look at the agenda for the rest of the afternoon.
In a second, I'm gonna hand over to Adam, our Chief Product Officer, who's gonna talk about how our existing set of products are gonna drive growth into the future. And then that's gonna be supplemented by Paul, who's gonna talk about the specific area of money movement that I've been referring to. Mark will talk us through our go-to-market strategy, what are our plans with existing customers, and then what are our plans to go win more customers. And then we will go back and talk about delivery and execution. You know, this is the market opportunity. How are we going to execute that? That's about slick and scalable operations that Leila will talk about and the technology that's going to enable all of this growth. And Keegan's going to talk about that.
Then if you can contain yourselves until this time, Rob is going to do the numbers bit that I know you all love so much. Really, Rob is gonna talk you through how we think some of these initiatives and potentials are gonna flow through into our numbers. There will be time for Q&A at the end. We've left quite a bit of time 'cause we know you're gonna have questions. So if you can hold, hold onto them until the end, that will be appreciated. There is going to be a sort of social drink soiree afterwards if you're able to stick around. So before I move on, just a few takeaways from me before I pass it on to the team. Firstly, we are committed to delivering our numbers. Our revenues are strong. Our profitability is strong.
We do have a clear strategy, and we are executing on it, and we are and remain extremely proud to work with a customer roster that I, I know you will agree is to die for. Most companies I've worked at would kill for our customer base. And then finally, we're not starting from scratch. We have an incredible network already in place, which is a platform for growth with over 200 local payment methods in over 60 countries. And so with that, it's my pleasure now to hand you off to Adam Lee, who is Boku's Chief Product Officer. Thank you, Adam.
So yes, my name's Adam Lee. Good afternoon. I'm the Chief Product Officer at Boku. I started with the company when it was just a small venture startup in San Francisco over 14 years ago.
And because I've been around a long time, people often ask, "Where did you get the company name?" Not a lot of people know Boku means growth in Japanese. It doesn't. I'm just kidding. There's actually no meaning behind Boku. It was a four-letter word. URL was available, and so we got it. But it does fit nicely on the stock ticker, which is convenient. But, you know, in over 14 years, I've had the privilege of traveling all over the world and seeing firsthand all of the changes in payments that Stuart's been talking about, the changes that mobile technology has introduced. But in spite of all those changes, the problem statement that Boku tackles today is the same one that we were trying to tackle 14 years ago when I first joined.
That is, how do we help online merchants who accept Visa and Mastercard unlock more growth when they sell their goods and services all around the world? That's why I think unlocking growth, driving growth, has been and continues to be at the heart of all of our products. How exactly do our products drive growth? First, it's our network giving them reach to more customers. Yes, Visa and Mastercard gives you access to possibly upwards of about 2 billion people around the world, but 5.5 billion people have access to mobile phones. That means 5.5 billion people have access to the internet, have access to e-commerce, and have access to a local payment method. Giving merchants access to more customers obviously facilitates more growth.
The second thing our product does is it facilitates seamless, repeatable purchases that drive recurring revenues, drives higher lifetime value for their customers. And that's another way we deliver growth. Third, we actually have technology that transforms local payments into new channels of marketing and distribution, moving up in the experience before a payment happens to deliver more opportunities for discovery and acquisition. And that's another way we drive growth by acquiring new customers. But I'd like to start with a simple question, which is, if local payments are so big and so important, why don't more companies do what we do? And the answer is, if you go to India, you'll find local payment companies there selling UPI. If you go to China, you're gonna find local payment companies there selling WeChat Pay, Alipay. The problem arises when you actually zoom out at a global scale.
Merchants that sell things across dozens of markets. When you're trying to sell things across dozens of markets worldwide, it's not very easy because now you've got essentially two choices. On the left, you've got Visa and Mastercard, which are two famous sort of international card networks. Now, Visa and Mastercard is not gonna be as secure, not gonna be as convenient, not gonna be as functional as a modern sort of app-based payment. But it does benefit from one thing, that it's governed by a single set of rules and standards that works all over the world. You know, it's a standard messaging format so that the point-of-sale terminals and the online gateways can be interoperable, standard settlement cycles, standard fraud rules.
You know, that's what allows a merchant's bank, also called an acquiring bank, to be able to receive funds from banks from all over the world as long as they too issue a Visa and Mastercard 'cause they all adhere to the same rules. But on the right, you've got this LPM ecosystem with payments that are more innovative, more dynamic, digitally native, built on the latest mobile technology. But it's also fragmented across hundreds of independent local schemes. So it's not surprising that you know a payment company that's trying to serve these global merchants is gonna choose to sort of start with the left because it's just easier. On the right, you're gonna have to integrate so many different payments.
For companies whose primary markets are U.S. or U.K. and most of the volume is driven by cards, you can see why they wouldn't, you know, really bother with the thing on the right. But it's important for global merchants to reach the other half of the population. Is there an easy way to simplify this highly complex, highly fragmented ecosystem? There's a way. It's not easy, though. We've spent years integrating each of these local payment schemes one at a time onto our platform, and we have to do it in such a way so that we can ensure that merchants can access all of them through a single integration, a single contract, single settlement flow.
Not only that, we also have to provide a singular global point of support, providing technical assistance, operational, commercial assistance to ensure that we can get the user flows and the commercial terms that the merchants need to meet their growth objectives. The end result? An incredible network that gives merchants access to more consumers, more markets, and because these connections are the ones that we've directly built, the confidence to know that they're getting the best performance. Of course, our network isn't done moving. Looking ahead, one of the most significant developments in the LPM space has been the emergence of instant bank-to-bank payments, or what we're calling A2A payments. A2A payments have actually reached into the population, parts that digital wallets haven't been able to reach. Therefore, it's expanded the total, sort of broadened the adoption of LPMs.
And so much so that if you just take digital wallets and A2A alone, by 2028, together, they will actually drive 51% of overall e-commerce, leaving cards with a relative 40%. That's why we're so heavily invested in curating and adapting A2A user flows for optimal e-commerce performance while also developing reliable ways to take those instantly acquired funds and repatriating them out of the country for wherever our global merchants need to receive them, which you'll hear more about from Paul. Now, we also build products on top of this network that help our merchants extract more value from this network, more value from the connections that we enable into the LPMs. I'm gonna talk about payments, and I'm gonna talk about bundling. But I'm gonna start with payments. Payments promises lower churn and higher lifetime value. How is that? I'll explain.
One thing to understand is that Boku processes millions of payments every day, yet 95% of them happen without a checkout. How is that possible? Because the way our product is built, it's designed to actually take one consumer authorization and reuse that over and over again for all future payments, creating a seamless, repeatable payment experience. That's why 55% of these payments actually happen silently in the background as part of a subscription renewal. 40% happen on the heels of an in-app one-tap purchase. Less than 5% actually originate from a traditional checkout. Why is that important? Because when a merchant acquires a consumer, you wanna keep that consumer for as long as you can for recurring payments and for a long-term relationship.
What our product does is create lower churn, higher retention, higher average revenue per user, which is what I mean when I say higher lifetime value. By delivering more recurring payments, we also deliver more recurring revenues for both the merchant and for Boku. It creates a natural moat around this partnership. And the way it reflects in our financials, Rob will show you a little bit later, is that for every cohort of merchant LPM connections, there's like a block of recurring revenue that compounds year after year, creating an incredible flywheel in our business model. Now, some of you might be wondering, isn't what you're describing just like a card on file? And it kind of is, but there's some notable differences. So all of us are probably familiar with a card on file. You save your card on file to subscribe to Netflix.
You save your card on file to activate one-tap purchases on Amazon. But the way card on file works is different from the way LPMs work. When you save a card on file, you're essentially trusting the merchant with your card number. You're just giving it to them. You're trusting them to keep it safe from hacks, from data breaches. You're trusting them to not abuse it with unwanted charges. And there's also the inconvenience of making sure that you're responsible, that all the card numbers across all the websites that you save it to are up to date, which means if you get a new card 'cause it's expired or you get a new card 'cause it's lost or stolen, you have to go and chase it all down. LPMs don't actually pass a card number to the merchant.
It creates what's called a mandate, which is a sort of standing authorization that gets stored into your app, which you can review at any time and you can void at any time. The newer mandates tied to A2A even have further configurations like placing limits on how much a merchant can charge you, how often they can charge you, and for how long. That type of visibility and control is going to be very important as the world moves towards more seamless automated payments. Speaking of seamless automated payments, think about if you're wary of sharing your card details with a merchant, how comfortable are you sharing your card details with an AI? Agentic commerce is predicted to go from 5 billion to 200 billion. Having AI not only help you shop, but actually complete your purchase.
Wouldn't it be so much better if before you give your payment method to an AI, you can actually place certain limits around it, certain safeguards? Working with leading companies like Google on the future, and shaping the future of agentic commerce, you can be sure that we're gonna be advocating for the use of LPMs and the mandates that they provide because we believe that giving consumers peace of mind is going to drive higher adoption of agentic commerce. Now I wanna talk a little bit about bundling, which is our product for subscriptions, and growing subscribers for merchants. Let me first try and explain how it works. So let's just take a subscription like NOW TV, which is brought to you by Sky.
Now, what you're seeing is an advertisement that Sky puts out trying to convince people to sign up for NOW TV. And the normal way that Boku helps is when the consumer wants to subscribe, they can choose how they wanna pay, and we'll provide them with, you know, if they're using Boku, with options to use local payments. Maybe if you're a Vodafone subscriber, you'd be able to choose carrier billing and put the subscription on your next bill. And that's a perfectly great use case. But what bundling does is actually very different. What you're seeing now is not a Sky advertisement. That's a Vodafone advertisement. Vodafone is offering their own entertainment package called TV PLUS. And what Boku's bundling platform does is it orchestrates a sign-up flow whereby the consumer who signs up for TV PLUS also automatically gets NOW TV from Sky.
Now, Vodafone's really happy about this because by adding NOW TV, they've enhanced the appeal of their product. But Sky's also really happy because Vodafone is distributing Sky to all of their existing customers. And both companies are actually really happy because when you combine both offerings, you create a stickier product, higher retention. Does this work? We've launched 63 subscription bundles this year alone, resulting in over 16 million new subscribers. Now imagine the subscription economy right now is worth $500 billion and growing at 13% CAGR. That includes emerging categories like AI subscriptions. We're very confident that demand for this product is gonna remain strong for the foreseeable future. Starting next year, we're gonna try adding to this sort of capability around marketing. And that is partnering with some of our payment apps. Now, a lot of these digital wallet apps don't just do payments.
They're called super apps. They're called super apps because in addition to payments, they also do ride-sharing, food delivery, e-commerce, banking services, social media services, and most importantly, they're used by billions of consumers every day. What we wanna be able to do is embed branded storefronts from our merchants into these super apps so that we can channel some of that traffic over to, create, you know, opportunities for discovery and acquisition. In fact, when they go and buy, you can even leverage certain native capabilities of the app, such as promotional offers or BNPL installments that can just be activated right inside the app. This is not just limited to subscriptions, but any category of e-commerce and sort of broadens the number of LPMs that we can leverage to deliver this kind of growth.
So in summary, our products help merchants grow because we give them access to more consumers beyond the reach of Visa and Mastercard, because we facilitate seamless, repeatable purchases that foster higher recurring revenues, higher lifetime value. And through bundling and payment marketing, we transform our LPMs into new channels of marketing and distribution that create more opportunities to acquire new users. And with that, I'll turn it over to Paul. Thanks.
Thanks, Adam. Hi everyone. My name's Paul Jarrett. I'm the Chief Banking Officer at Boku. I've been here just over a year and a half, and I'm delighted to be here today to talk to you about a global money movement capability. I'm gonna try and break this down into a few core components and give you an understanding of the why, the how, and the who when it comes to money movement. I'll explain the significance of the cross-border opportunity and how we're building a platform to solve for both current and future merchant requirements, and ultimately, we believe the development of this platform will start to reshape over time the revenue profile at Boku. Stuart's already covered many of the reasons why the size of the LPM opportunity is so large, but I'd like to talk about why the cross-border opportunity is so important.
India and UPI specifically is a really great example of this. UPI is the Indian government-backed real-time payment scheme. And in a very short period of time, it's become the predominant payment rail in the country with over 400 million users. It processes over $300 billion in TPV per month. Excuse the typo. But e-commerce transactions via UPI cross-border are less than $1 billion per year. So why is that? Well, UPI is still relatively new and it's evolving, and it was initially conceived as a domestic payment rail. The other part is that cross-border payments are really difficult. India is a highly regulated market. There's capital controls, in-country compliance, data residency restrictions. There's foreign exchange volatility and liquidity challenges, and local banking infrastructure can be legacy. Now, these things are hard to solve, but solving them is really valuable.
Cross-border volumes by UPI are projected to increase massively over the coming years, and margins for cross-border transactions reflect the challenges. They are much, much higher and much more resilient than domestic payment fees, so the juice really can be worth the squeeze when it comes to cross-border payments, and India, or UPI specifically, is ready for liftoff, and LPMs across the globe are rising in popularity, but they weren't built for cross-border either, really. They each have different regulatory reporting, settlement, banking, and liquidity dynamics, so cross-border for LPMs is really, in many ways, just getting started. We're just turning the taps on. Domestic payment rails evolve to become cross-border channels driven by companies like Boku, creating conformity and driving interoperability. You can see from the chart on the right here that LPMs are set to be responsible for a quarter of all global cross-border transactions by 2032.
That is trillions of dollars. So why Boku? Well, we are uniquely positioned to solve this problem. Boku acts as the global layer of money movement conformity to our merchants, simplifying these complexities. Boku sits at the intersection of the issuer and the merchant in the center of the payment flow, critically placed to solve for the challenges and opportunities of cross-border payments. How do we build a money movement capability to take advantage of such a huge opportunity? Adam spoke a moment ago about the size and the high quality of Boku's LPM network. And we see money movement as an additional layer on top of this network, enhancing the product offering. And we can break our money movement platform down into three key pillars: our banking and licenses, our treasury technology platform, and our foreign exchange solutions.
I'll speak a little about each of these in the coming slides, but the key message really is that by building direct network connections coupled with direct banking infrastructure overlaid by a scalable automated money movement platform, we can create enhanced product offerings to merchants that drive revenue and growth. What do I mean by direct banking infrastructure? Issuers receive funds from consumers, and then the issuer pays that money into Boku's bank account. Boku is licensed to collect those funds and move those funds across borders. No third parties, no intermediaries. That means we own the rails. Why is owning the rails important? When you own the rails, two good things happen. You own the merchant experience: faster settlement, better reconciliation, more concise and deeper reporting. If you're not direct, you're relying on third parties. All of these become potential operational problems.
And secondly, if you own the rails, you can optimize for the revenue opportunities. We do the foreign exchange. We control when and with whom we trade. We control the margins. Other PSPs can't say the same. They have aggregated connections, multiple parties in the flow of funds, more operational risk, higher cost to serve. So Boku's model is simple, really. We own the rails, we control the merchant experience, and we optimize for unit economics. This gives us superior rails compared to the competition. And our banking network is expanding rapidly, way beyond that of a pure DCB business to that of a truly global PSP. We've onboarded two additional global strategic banking partners in J.P. Morgan and Standard Chartered Bank to complement our strong and progressive relationship with Citibank. We've also onboarded a number of pan-regional specialist banks and local onshore banks.
These give us deeper FX liquidity pools, better understanding of local market dynamics, and strong in-country regulatory expertise, so the bank network is evolving to support new geographies, new product, and new capabilities, from channel partnerships to digital assets and beyond, so we have a large, extremely high-quality direct network of bank infrastructure, but in order to make that scale, we have to layer over the top of that best-in-class technology, and this brings me to our technology platform. Today, we're one year into a multi-year transformation plan to take us from what was a basic finance function to a global follow-the-sun treasury and foreign exchange division supported by a money movement platform capable of settling, reconciling, and reporting in real time, and we've made lots of progress.
Some of the things we've done so far, we've implemented a treasury management system, and this enables us to move money around the globe efficiently and electronically across all those bank accounts I just mentioned. It also gives us the capability for better real-time cash and liquidity management. We've implemented an execution management system. This gives us real-time foreign exchange risk management capabilities. And we're continuing to enhance our transactional reconciliation capabilities. Processing and reconciling faster means we can pay merchants faster. So all of these things really are less manual workflows, higher levels of efficiency, building for scale. And we're also investing in data capabilities: more data-driven decision-making, more use of machine learning models, and embedding AI in our treasury and banking workflows. In all, this is a robust, scalable platform driven by superior use of data and analytics.
And we need to be able to manage our risk effectively and maximize the revenue opportunity if we're gonna win in cross-border payments. So we need to be good at foreign exchange. And what are we building? Well, it's an automated riskless principal foreign exchange capability. That means no proprietary risk-taking, no gambling Boku's money or that of our merchants. Instead, we'll generate alpha by optimizing for access to liquidity and solving for volatility. We'll drive stronger commercial pricing through quantitative analysis and deeper understanding of local market dynamics. We wanna be the trusted partner in foreign exchange to our merchants. So we're not just providing access to the best foreign exchange rates. We're also providing TCA, transaction cost analysis. That will allow our merchants to validate and benchmark our rates against others in the market. And why would we do that?
Well, you know, we believe FX is not a place to hide margin from merchants. It's an opportunity to show them the value that we create. We'll get the best FX rates by finding the deepest liquidity pools, be that banks, brokers, financial institutions, or corporates, but always following a compliant approach. Others will do it differently, but we believe that our data-driven, transparent, but competitive approach, underpinned by strong risk management and compliance, wins out in the long term. So that's the how, the three pillars. But I suppose the question is, where are we on the journey so far? What have you been up to, Paul? Well, we've hired some great people, and I'll come to that a little later, but they've already started to have a big impact. And we now have treasury and foreign exchange teams co-located in London and Singapore, local expertise in region.
We've improved working capital by nearly $30 million. We've unblocked trapped cash, and we've optimized for legacy account setups. The first phase of our automation project has already saved over 120 hours of manual workflow per week, and we'll go further in 2026 as we roll out our straight-through processing capability across the rest of banking and finance. Critically, we've brought over $1 billion of foreign exchange flow back in-house, no longer allowing issuers to manage foreign exchange on our behalf and charging us for it. We're managing the funds. We own the rails. We're adding more value, so there's a lot of wins, but we're just getting started, and we've got big ambitions. We wanna solve more merchant problems, and merchant problems in money movement fall into a few categories: volatility, liquidity, speed of settlement, and Boku has capabilities now to solve for all of these.
I'll give a couple of examples where we're going slightly further as well. An online e-commerce retailer needs to be able to offer 90-day refunds. A consumer buys something, but 90 days later, they send it back. They don't want it anymore. The refund rate will be determined by the foreign exchange rate on the day of transaction. But the FX rate 90 days later could be wildly different. How does the merchant manage this risk? What does the merchant do with the potential profit or loss created by the difference between those two foreign exchange rates? Another example we come across is a merchant has started commercial operations in a country, but they can't repatriate their funds. They've got trapped cash, and they've looked into it, but they no longer have the licensing or the liquidity to be able to solve for it.
Boku has solutions to both of these problems. We can solve for refund risk through our guaranteed FX rate solutions, and we can solve for trapped cash through our liquidity products, even in emerging and frontier markets, and we're still going further. Boku's known for its collection capability, but many of our merchants have really strong payout use cases. I'm thinking streaming services needing to pay royalties to users around the world or content creators globally. Boku's solved for collections. It makes sense for us to solve for payouts as well. Our merchants would be interested in being able to net their inflows and outflows in the same market, and we know that the payments landscape is evolving quickly at the moment, so we've built a team in Singapore dedicated to foreign exchange and money movement innovation, and this team will help us develop new product faster.
It will allow us to stay relevant and co-create with merchants, which ultimately will drive new differentiated revenue streams. And it would be a miss when talking about innovation not to talk about digital assets and stablecoins, seeing as they get probably far too much airtime in the public domain. I think the first thing to say is that we see this as an opportunity and not a threat. Stablecoins do solve for faster settlement, but only where they're regulated, which at the moment is just in a handful of developed markets. So there's a long way to go in the evolution of digital asset regulation. They also don't solve for foreign exchange. There isn't suddenly more liquidity in the Philippine peso or a less volatile Nigerian naira just because the conduit to move those funds was digital.
However, we do believe they're going to be important in the way that the payments landscape evolves over the coming years, so we already have a number of initiatives underway working closely on this. We're already using tokenized deposits. We're moving money in real time for our corporate treasury accounts globally. We're exploring the stablecoin sandwich, where we take fiat funds and wrap them into a digital asset, moving them cross-border, and then pay merchants in fiat much faster, and we're also exploring stablecoin as a payment method itself, allowing users to directly pay via stablecoin, so hopefully I've explained why Boku has such a huge opportunity in front of it and the steps that we're taking to realize some of that, and while it's still very early, the exciting part is that many of these products you can see here are already live today.
And we're just starting to move away from the previous fee-only model to a new model, one where we offer merchants a new modular set of products. We offer merchants the full menu. This may mean that some want foreign exchange, some want collection services. It'll widen our addressable opportunity. And that will support and enhance take rates and over time start to change the revenue profile of the business. And I promised to talk about the who. Given everything I've said, I clearly didn't do this on my own. We've hired over the past 18 months a high-performing team with diverse backgrounds and strong experiences from the very best of fintech, e-commerce, banking, and foreign exchange. And these people are now having a real impact on the business and bringing best-in-class capabilities to the organization globally. So I'll leave you with some very simple takeaways.
The cross-border opportunity in LPMs is just getting started, and it's going to be huge. Tell your friends. Boku is positioned to win here, and we're building a direct, scalable platform to deliver this. We're solving real merchant problems and committing to delivering innovation, and I'll hand over to Mark. He'll talk to you about his team's plans and the exciting go-to-market opportunity. Thank you.
Good afternoon, everybody. I'm Mark Stannard, the Chief Business Officer at Boku, and I've actually been with Boku since day one, June 15th, 2009, and since 2016, I've had group-wide responsibility for revenue growth, and from 2016 through to 2024, Boku has grown its total payment volume by over 2,000% and revenues by more than 600%.
Our focus continues to capitalize on this unique strategic opportunity that we have to continue the momentum that we've seen over the last few years as the opportunity gets even larger. You know, our ambition is very clear. We wanna continue to grow our core and unlock new revenue streams. Material growth will continue to come from the existing merchants, the world's biggest tech companies. Additional growth will come from a new cohort of high-growth merchants, the tech titans of tomorrow, adopting our product offering to execute on their ambitious plans. Lastly, we will grow by expanding our product portfolio to meet even more merchant needs, as Paul has just outlined. Together, these pillars drive sustainable, diversified growth across the Boku ecosystem.
At our last Capital Markets Day, if you can remember back that far, in 2023, we set a target to double our revenues in four to five years through our existing customer base. And market consensus suggests we will achieve this by 2025. That track record gives us confidence. We can do it again, powered by our loyal, expanding merchant relationships. And let's remind ourselves who these companies are. They're the world's leaders in digital entertainment, the biggest global brands in tech and media. We're deepening our presence with them, delivering rollouts at scale, and are becoming an integral part of how they grow. Our solutions power their cross-border growth, which in turn powers our growth. This sector is highly concentrated, often winner takes all. These companies represent around 27% of the S&P 500 and generate over $2 trillion in annual revenue.
Let's just let that sink in for a moment. Our top nine merchants have a combined annual revenue that is almost the size of the GDP of Brazil or Canada. And importantly, they keep growing. In the last five years, these merchants have grown by over 60% from just above $1 trillion in 2020 to more than $2 trillion in 2024. So the huge revenues from these companies keep getting bigger. Really, is it any wonder that Boku keeps growing so fast? And who are these companies? Well, they're digital-first, mobile-native enterprises operating in consumer and prosumer markets, focused on digital and subscription-based verticals. Enterprise scale with global reach, built on recurring revenue models. Often more than 50% of their digital revenue is ARR. And how do they grow? They grow by expanding cross-border revenues. Over 50% of their revenue is cross-border.
They grow by entering new markets across APAC, EMEA, and LATAM. They grow by improving conversion where cards underperform. They grow by localizing payments to boost acquisition and retention. They grow by building sustainable subscription-led growth. Boku specializes in delivering on all these merchant growth vectors, which in turn powers Boku's growth. And importantly, we're only just getting started. We've connected roughly less than half of the available merchant opportunities to our network of LPMs. So there's huge white space ahead as these merchants continue to grow. You know, they're ramping up on live connections. Typically, each connection takes more than four years to reach maturity. And for subscription merchants, we still see some of these growing after four years. Rob will speak to this in more detail later, but it is amazing to see how the revenue from existing connections continues to compound.
The second way existing merchants will continue to grow, as Stuart pointed out earlier, is by adding more LPMs already connected to the Boku Platform, as these merchants continue to expand into new geographies and go deeper in existing geographies. Lastly, existing merchants will keep growing as Boku adds more high-traffic LPMs to its network and the merchants launch these connections. These three growth vectors continue to create material growth for our merchants and by extension for Boku. Our successful rollouts are so effective that they have become the blueprint for the tech industry, and the next wave of merchants wants to replicate that same velocity and success, so we're now looking to unlock the next wave. You know, where do you go after you have the world's largest merchants?
You look at what the next set of the world's largest merchants are going to be, and you make sure you start working with them, and Boku's uniquely positioned to maximize the value for the next generation of tech companies, leveraging our experience, scale, and know-how. These merchants will be a key driver of our future growth, all within a proven product-market fit we already know how to win and deliver. Stuart mentioned how our addressable market is expanding rapidly. The SOM, the service obtainable market, the realistic near-term share based on capacity, vertical focus, and current product maturity is around $1 trillion, and as Stuart said earlier, we're not looking to fill the entire chessboard. We're going from one square to the next square. It's very, very focused.
Now we're actively pursuing those new verticals to capture it, where we have the product, platform, and knowledge advantages over global and regional card processors. It's not just today's tech titans that will have access to Boku's secret sauce to power their high-growth business. The tech giants of tomorrow are already lining up to use us. Why is it repeatable? These new merchants look exactly the same as our current winners. They're digital-first, consumer-led, and scaling globally. We're not talking about chasing thousands of small prospects. These are sizable merchants that are growing rapidly and will become the major tech companies of tomorrow. They include companies such as Canva. I'm not sure if you've heard of Canva at all, but we started working with them, and they're already valued now at $42 billion.
These companies are based in our usual hunting grounds of the U.S., Europe, and APAC, and they're looking to expand across EMEA, APAC, and LATAM. That's why our success is repeatable, predictable, and proven. And we're now moving beyond digital entertainment. So let's dive into some of these verticals in more detail. The first is really digital subscriptions. Now, this is really Boku's home base, as you heard earlier from Adam, that more than 50% of our transactions are already subscription-based. And this sector, spanning digital entertainment, software, and increasingly AI solutions, is projected to grow by 67% over the next five years. Merchants like Disney, Adobe, and the AI companies share the same commercial objectives and product needs as our core entertainment partners. And they can leverage Boku's full suite of payment, payment marketing, and bundling products.
Again, coming back to Canva, Canva is scaling across multiple markets using Boku's proven technology, the same refined solution trusted by Netflix and Spotify. Digital advertising is another high-growth sector cross-border that we are looking to expand into. It's currently growing at a CAGR of 9%. Existing Boku partners like Meta, Google, Netflix, Spotify, Microsoft, and Amazon already rely heavily on advertising as part of their revenue mix. But outside one or two merchants, we've only really scratched the surface of this opportunity. And we're engaging with more digital-native advertisers where we can deliver clear, measurable value to maximize the revenue opportunity for the merchant and Boku. Online travel is another fast-growing vertical expected to exceed 10% CAGR over the next decade.
We launched with Agoda, who's part of Booking.com, and we've seen much higher transaction values, meaning higher Boku revenues per transaction, using the same product playbook proven across our digital services base. I think an important thing to say about this set of merchants as we move into this next group of merchants is that historically, it's taken around 18 to 24 months to get merchants from engagement to revenue. But what we're seeing with a number of merchants that we're engaging with now is that that time is getting cut to around 6 to 9 months. So the time to revenue is going to accelerate. And as we go after this new area, we're really transforming through our talent as well. So as part of our transform and perform strategy, we've built a scalable go-to-market organization led by people who have done this before.
This isn't just about adding headcount. It's about upgrading capability. We've added proven specialists in enterprise sales, account management, and partnerships, a strengthened merchant solutions team able to meet complex enterprise needs, elevated growth marketing to drive awareness and demand in high-potential verticals. Together, this team forms the commercial engine driving Boku's next stage of growth, a clear example of how we're transforming to perform. You know, and how are we delivering on this new go-to-market plan? Well, importantly, we've tested the product-market fit on key merchants in target sectors. We've just spoken about some of those. There are others that will be coming online that we can't speak to at the moment. And based on this, we've built a targeted pipeline of hundreds of merchants we know need this product. So this isn't about us trying to go out there and see if the market is ready for it.
These merchants require this now to compete against the tech titans of today. And some of the merchants that we've launched recently using this motion would include things like Disney, Canva, Noon, the major e-commerce player in the Middle East. And there are several leading AI companies that we're engaging with as well that we'll be talking about in the future. And we've built a really, really strong go-to-market team. We've got key hires from Amazon, Worldpay, Amazon Payments, American Express, NEOM, Oracle, who have done this before and are ambitious to build solutions for the tech titans of tomorrow using the next generation of payments. This is a very exciting place to be, and it's attracting the world's best talent. Three, we are seeing great product-market fit, as I spoke about earlier, and building a team to maximize the scale of that opportunity.
As I've just said, this has already been validated by a number of household names that have already launched with us. And now we're scaling the sales team and building the sales and marketing funnel to meet the expanding opportunity that we've already validated. You know, expect early results by the end of Q1 2026, but it's looking very promising, and some major wins are in the near-term pipeline. Everyone's very excited. And the wider product tech and ops teams, as you'll be hearing later from Leila and Keegan, they're also kind of scaling up to meet with the demand that we see coming down the pipeline. But what's important, though, is that our go-to-market is focused, efficient execution. As I've already said, we're going after a few hundred merchants, not thousands. It's giving us focus, efficiency, and impact.
You know, we're building visibility within our ISP, sorry, our ICP and verticals. We're deepening our position of Boku as the trusted global LPM partner, and we've got some of the world's best references to point to as we've done this before, and we're really strengthening our presence through thought leadership, PR, and events, so we're being invited to more and more of these global events, like the MRC, you know, as our expertise is known worldwide. We're also running targeted campaigns by vertical and region. You know, we're looking to balance the outbound and inbound approaches and create a repeatable, scalable engine for qualified leads. Importantly, we're able now to arm sales with stories, data, and case studies, showcase our key enterprise wins to enhance our credibility and build trust to accelerate the conversion.
The third area that we're going into as well, as Paul and Adam were talking about, is as we start to expand the product offering. So that's the last vector, really, for our future growth is through the new products designed to meet the evolving needs of our merchants. As I say, Boku is perfectly placed to deliver what the market demands efficiently, reliably, and at scale. I think what's important here is to remember is that these aren't possible things that we're looking to deliver. These are the demands that our current merchants are asking for today. We're broadening our product footprint to deliver more value with every relationship. Our customers have important problems they need fixed. We don't have to sell these products to them. We must deliver what they're requesting. For these major companies, onboarding new partners is costly, time-consuming, and always a risk.
That's why merchants increasingly prefer to deepen ties with trusted partners such as Boku rather than onboard new partners. Because of our proven track record, excellent performance, and reliability, it makes Boku a natural choice to reliably solve the next generation of challenges, just as we did with LPM acceptance. That's how we move beyond payment processing into richer, more strategic partnerships, further deepening our ties with existing merchants and making us a natural choice with new prospects. And we'll continue to sell on value. As Adam said earlier, you know, our focus is fixing high-value, complex problems, the kind that makes us indispensable to our merchants. By delivering higher yields for our customers, we are chosen for value, not cost. The higher lifetime value merchants gain by working with Boku is critical to them not just growing, but reaching profitability more quickly.
That's how we build high-value, sticky relationships that last. So, in summary, Boku will see material growth from existing merchants rolling out more LPMs. That's business as usual, something that we've proven that we can do over the years. Additional growth will come from new merchants in adjacent sectors. Think the major tech companies of tomorrow. We're already signing these up. It's already happening. Further growth will come from delivering new capabilities that Paul and Adam spoke about, and these are the capabilities that the merchants are demanding today. We don't need to sell these products; we just need to deliver. And we'll continue to sell on value as we fix difficult problems and deliver a higher yield.
Hi everyone. I'm Leila Kassner, Boku's Chief Operating Officer.
I've been with Boku for over 11 years, originally leading our global merchant partnerships team before stepping into the COO role earlier on this year. I have loved working alongside our merchants, understanding their needs and how they operate, which now helps to shape how I drive our operations, making it more efficient, scalable, and focused on delivering real value for our merchants and for Boku. I'm going to spend the next few minutes talking to you about how we're supporting growth through operational excellence. You've heard from my colleagues today about our growth vision and strategy. Achieving that vision depends on our ability to execute with operational excellence. We have been working to build efficiency into our workflows without compromising quality to drive faster execution, improve merchant outcomes, and support rapid growth.
That means investing wisely, delivering value quickly, scaling to support the world's largest merchants, and applying the rigor needed to support trust. These qualities are why the biggest global brands choose Boku. For us, it's not just about growth. It's about sustainable growth. This is why we're well-positioned to be the world's best localized payments partner for global commerce. So let's dig into what operational excellence really means for Boku. Operational excellence at Boku is about enabling rapid growth sustainably. It's not just about efficiency or speed to market. It's about making highly complex local payment operations simple for our merchants and doing that at global scale. In a fragmented and high-risk payment landscape, our merchants depend on us to deliver efficient, secure, and compliant local payments wherever they operate. We're not just processing transactions. We're protecting their business and supporting their growth.
That's why Boku is such a critical enabler of our merchant strategies, giving them compliance access to billions of user accounts worldwide, and we're trusted to do it right. So the next question is, how do we deliver on that? It all comes down to three core pillars that work together to improve merchant performance and strengthen our growth engine. First, we're supercharging operations, integrating the right tools, refining our processes, and enhancing capabilities so we can deliver more consistently, efficiently, and at scale. This is what gives us the foundation to execute faster and with greater reliability. Second, we're accelerating time to revenue for our merchants and for us. By streamlining our onboarding and simplifying delivery, we help merchants enter new markets faster and start generating value sooner. Faster delivery builds confidence, reinforces trust, and deepens those partnerships.
And third, we're protecting trust because in a regulated environment, compliance and reliability aren't optional. They're essential. Trust is what keeps merchants choosing Boku for their most critical payments. Together, these three pillars create a powerful cycle. Operational excellence drives faster execution, which accelerates time to revenue, which in turn strengthens merchant trust and loyalty. That's how we deliver growth at scale. Let's take a closer look at our first pillar, supercharging operations. Supercharging operations is about execution that's faster, more reliable, and scalable. This year, we've upgraded 64% of our legacy Fortumo connections to Boku's payment gateway products, and the rest will follow by the end of the year. This is boosting performance, releasing costs, and improving merchant outcomes. By embedding project management discipline, setting achievable ETAs, and resolving blockers fast, we have delivered 100% of our standard issuer merchant launches on time this year.
We're also smarter through automation and machine learning. Monitoring now covers 100% of active products, and false alerts are down 40% while still catching every partner outage. That's greater efficiency, fewer distractions, and stronger resilience for merchants. These are but three examples of how we are supercharging operations. It's operational excellence in action, disciplined planning, flawless delivery, helping to turn our operations into a true growth engine. Accelerating time to revenue is more than just fast onboarding. It's about creating value at every stage of the merchant journey. This year, we've standardized our onboarding and launch process, which has already helped us cut time to launch by two weeks and allowed us to deliver twice as many merchant and issuer connections, 92 in total, in H1 compared to last year. That's faster scale for merchants and faster revenue for Boku. But we don't just stop at launch.
By expanding our post-launch support and embedding customer success analysts, we're optimizing performance where it matters most. Features like implementing payment fallback options are driving real measurable outcomes. For example, ShopeePay in the Philippines saw a 19% jump in user conversion once fallback was enabled. That means we help to prevent thousands of users from churning every month, protecting user experience and generating more revenue. Accelerating time to revenue is a powerful growth engine, creating value for our merchants and for us. Last, but definitely not least, protecting trust. This one is particularly close to my heart. We have built a reputation for doing things in the right way. Protecting trust is the most critical part of our value proposition, ensuring global payments operate safely, reliably, and compliantly.
This is where Boku truly stands apart, and it's why we have worked with some of the world's largest merchants for over 10 years. We operate with a compliance-first mindset. It is embedded into every workflow, and we back this up with local compliance specialists who build trusted relationships with regulators. Importantly, we support regulated markets where compliance is complex and scrutiny can be high. Our ability to deliver in these markets is a key differentiator, proving that Boku can be trusted to do it right, even under the toughest regulatory standards. Our operations are further strengthened by trusted tier-one banking partners, giving us dependable FX and money movement capabilities that Paul spoke about earlier today, and with our 24/7 on-call global technical support team, we deliver the reliability and the resilience that our merchants expect. This is what protecting trust really means.
It's not just about reducing risk. It's enabling faster, safer market entry, building long-term merchant loyalty, and ultimately powering revenue growth. But don't just hear it from me. Hear it from our merchants. This quote really brings this to life. We receive many emails like this from our merchants, but this one for me stood out. Why? It's rare in today's world to be able to pick up the phone and immediately reach someone who knows your business and can help. That's what protecting trust looks like in practice: being there when it matters most. It's about reliability, responsiveness, and real partnership. And for our merchants, that kind of operational support isn't just appreciated. It's remembered. What you've heard here today is that Boku has set the right foundations in place and has the results to prove it.
We've shown how operational excellence is powering our growth and how we're executing with discipline to support our merchants. Looking ahead, our growth comes from building on these same foundations, scaling operational workflows, and embedding more automation to continue to release capacity needed to fuel new growth initiatives. We will continue to enter new markets safely and compliantly and deliver new features that drive measurable outcomes for our merchants. In short, more of the same, because what we're doing works. This brings me back to where I started. By investing wisely, delivering value quickly, supporting global merchants at scale, and protecting the trust that underpins every transaction, we accelerate growth. Operational excellence is the engine that makes this all possible. I will now hand over to Keegan, who will talk a little bit more about enabling growth through our technology.
Hi, I'm Keegan, Boku's Chief Technical Officer.
I've been with Boku more than 15 years, and my team has built, tested, and run the Boku products and platform. Alongside operational excellence, technology is a key enabler for our future growth and vision. As you've heard, we're expanding our products, increasing our money movement throughput, and growing our merchant base, all powered by our technology. Today, I'll cover three things: how our platform supports growth, how technology builds merchant trust, and how we're investing wisely for the future. Powering everything, all our products is the best-in-class Boku Platform, developed over 15 years to the highest standards of the world's largest merchants. It supports more than 200 different payment methods through a single integration, abstracting away complexity into a single unified interface. Built on AWS with a relentless focus on reliability, scalability, and security, it stays up even if AWS has issues.
Its modular architecture lets us grow easily, build new solutions, and evolve securely for the future. This modular architecture gives us the flexibility to adapt the platform for future growth. It supports 5x volume growth out of the box with no additional investment. It enables fast expansion of payment methods and easily accommodates new merchant use cases like agentic commerce. Our modular platform also powers a feature we call reverse integrations, where we integrate into the merchants instead of them integrating to us. This delivers value faster, aligns the checkout flows, and makes us a better partner for those merchants. The modular architecture also enables us to do co-creation with our merchants of new solutions. Our global engineering team has partnered directly with the engineering teams on the merchants to develop products, accelerate integrations, and optimize flows.
Just last week, we sent a team to New York to work with an AI company to co-deploy a global partnership distribution solution. This enabled us to deliver this 12 x faster than doing it over Zoom and other methods. But simplicity, flexibility, and scale only matter if we maintain merchant trust, and we do that through reliability, quality, and security. Our uptime guarantee is backed by machine learning-based monitoring that detects issues quickly. Our quality assurance organization uses both automated and manual testing to ensure we keep releases bug-free. And we have a dedicated network testing team that tests our payment method partners. That team has prevented more than 300 issues this year alone. And with ever-growing threats, we embed security into everything we do. We've built machine learning monitoring to monitor our platform and network.
Unlike cards, there's no central authority to enforce reliability on the network, so we built our own. We have over 13,000 monitors that detect outages in the carriers across the network, empowering our NOC to enforce our performance standards and cutting the noise. As Leila mentioned, we've seen a 40% reduction in false positives while maintaining 100% detection of outages. In some cases, we've seen even up to 80% in reduction of false positives versus off-the-shelf tools. Building on that platform, we're also investing in three key areas. We're transforming the back office by automating processes to reduce manual work and support new money movement products. We're using data and machine learning to power our merchant growth through optimization and recommendations. And we're scaling efficiently through AI tools that unlock capacity and productivity.
We've been on a multi-year journey to automate the back office, from collection to reconciliation to settlement, enabling straight-through processing for finance. These investments free manual resources and lay the foundation for new FX and cross-border money movement use cases. The second area we're investing in is how to use data to drive growth for our merchants. Every transaction that goes through the Boku Platform gives us a unique view of local payment methods worldwide. We already turned that data into insight, helping merchants choose the right payment options and fine-tune performance, and now we're going further. We're building automated models that deliver personalized real-time recommendation, helping merchants refine their payment mix, accelerate optimization, and deliver seamless customer flows. This kind of intelligence exists for cards, but for local payments, there's a huge opportunity. That's where Boku's scale and experience give us an edge, and we're not stopping there.
On top of these models, we're developing new product features, including self-service recommendation tools, pricing models, and specialized fraud detection, and to deliver value more efficiently, we're using AI and automation to boost productivity. Beyond the basics like ChatGPT, Copilot, and Cursor, we're piloting other tools that enhance delivery. We built a chatbot for operations to answer questions without engineering support. We've deployed AI-enabled debugging tools to help our NOC reduce downtime, and my personal favorite, we're automating generation of payment method connections from API documentation, cutting delivery from weeks to days. These investments ensure scalable, cost-effective growth. Technology underpins our future growth. We're building on 15 years of trusted platform foundations while investing in the back office data and AI to drive the next phase of growth, enabling Boku and our merchants to thrive together.
And now I'll hand it over to Rob to talk a little bit about the numbers.
Good afternoon, everyone. Nice to see so many friendly faces. For those that don't know me, I'm Rob Whittick. I joined Boku last year. Why did I join? I joined Boku after having spent a day with Stuart, and he articulated much of what you've heard today: a very exciting vision, and I felt that very compelling and joined the company. So, as you've heard today, we've built real momentum strategically, commercially, and operationally. We've delivered double-digit revenue growth for several consecutive years while increasing adjusted EBITDA and generating cash. This combination isn't common in our space and reflects a strong operating model and disciplined execution.
Before diving into the numbers, I just wanted to. I thought it was worth spending a moment to look at and understand the financial building blocks of Boku. As you've heard, we connect merchants with the world's population through local payment methods. People who use our network each month are monthly active users, or MAUs. Now, MAUs are a good indicator of growth, but they don't tell the whole truth. One MAU might make a single subscription payment in a month or dozens of small in-app purchases. What really matters is that MAUs drive payment volumes, and payment volumes multiplied by our take rate drive our revenue. Take rate is simply the average margin we earn across all of our products. Our profitability measure is adjusted EBITDA, which removes some non-cash and one-off items from operating profit.
When it comes to cash, our group cash balance includes merchant funds in transit. So, to get to our own cash, we adjust our outstanding funds relating to both merchants and issuers. So, back in March, we set out our medium-term guidance: greater than 20% organic revenue growth on a compound annual growth rate basis and over 30% adjusted EBITDA margins accreting from and including 2026. We highlight CAGR because our growth won't come in a straight line. We very much see it as a wavy line over the medium term. Most of you will know how we're tracking this year, but as a reminder, both revenue growth and adjusted EBITDA were ahead of expectations at H1. This was driven by a 28% growth in payment volumes alongside a higher take rate. This translated into a 9% increase in our own cash in just six months.
As a result of this performance, we upgraded our revenue guidance for the full year from 20% - 27% growth year- on- year. We continue to be comfortable with this upgraded guidance based on our current trajectory. This slide shows revenue, adjusted EBITDA, and free cash flow from 2022 through to H1 2025. The gray section in 2025 is only there to show consensus expectations for the year. You can see the story: strong, consistent growth across all metrics. Market consensus is forecasting our revenues to double versus 2022, and they've already become more diverse. We've moved from a single product, DCB payments, to a broader LPM portfolio, including digital wallets, account-to-account, and bundling. And as you've heard, this year, we've added new products to further diversify our future revenue streams. Throughout that growth, we've kept adjusted EBITDA margins above 30%, showing discipline and operational control.
Importantly, all of this growth has been self-funded. No debt, just cash we have generated. For the first time, we've built a data cube that allows us to better analyze historical performance. This lets us see exactly how annual connection cohorts generate revenue over time, as Adam mentioned earlier. The takeaway is clear. Our connections generate recurring and compounding revenues. Each year's cohort builds on the last, creating a solid structural base of recurring income. If I take 2021 as an example, connections launched in that year generated $1 million of revenue. Then in 2022, $4 million, $8 million in 2023, and $12 million in 2024. We do see a 6 to 12 month ramp-up, then very strong growth for four or five years. After that, pricing dynamics between merchants and consumers take over.
This data confirms to me, particularly, that our growth is very much volume-led and gives us a framework to forecast connection revenues in the future. So this was a slide I was previously talking to. So you can see here what we're demonstrating with the cohort analysis is that the blocks at the bottom are pre-2021 connections and then 2021, 2022, 2023, 2024, and 2025. And you can see very much 2021 is the pink that I described, very much how over time these connections compound. So here we show total payment volumes and take rate progression since 2022. And I think this picture backs up the cohort analysis. Revenue growth is definitely coming from rising volumes. We've added more and more connections across the network as our merchants continue to adopt LPMs as they access increasing numbers of consumers across the world.
The rising revenues and volumes have delivered consistent Adjusted EBITDA growth, confirming the predictability of our business model. To ensure transparency of our earnings, we will disclose material one-offs as they arise. In H1 2025, we called out $3 million of launch phase pricing, which is not expected to occur in the 2nd half, and also, we have for the first time included $1.4 million of currency conversion costs within Adjusted EBITDA so that currency conversion revenues and costs are appropriately matched. Turning to costs, between 2022 and 2024, adjusted operating expenses rose from $42 million to over $65 million. This is deliberate investment to support higher payment volumes and increasing complexity. As you've heard, A2A is a regulated product that settles multiple times a day, whereas DCB is unregulated and settles monthly or even quarterly in some jurisdictions.
Supporting that shift towards A2A requires investment in automation and risk and compliance, again, as you've heard today. We're also building new products and capabilities, including the banking and settlements infrastructure and the innovation hub in Singapore that Paul has talked to. And finally, new data and AI capabilities that will help us grow and improve efficiency over time. An example here is we've built a very small and highly skilled data team in Poland. Their first task was to build the data cube, but I skipped past rather quickly. These investments have built the foundation for growth and margin expansion from 2026 onwards. Boku remains debt-free and consistently cash-generative. Our own cash has grown 57% from 2022 to H1 2025. In the 1st half alone, we generated $15 million in free cash flow after capital expenditure and changes in our own working capital.
That delivered, as I've said, a 9% increase in our own cash or a 24% increase if you exclude the $12 million of share buybacks we completed during the period. So that's the foundation: strong growth, solid profitability, and consistent cash generation. So let's see what the future looks like. The future of growth we see is coming from two core engines: more connections between existing merchants and LPMs, and second, new merchants, new LPMs, and new products, as everyone has articulated today. Starting with the connection progression, this is the core engine. It's built on the 1,000 connections we've already delivered and the pipeline of new connections we can see over the next 24 months. As we've said, each connection compounds, creating recurring, predictable revenue streams. And that's a core engine behind consistent growth. The second driver, as you've heard, is new merchants, new products, and new payment methods.
As Mark outlined earlier, one of our key pillars is around attracting new merchants. As we connect these new merchants to LPMs, this will drive up volumes. To take a recent example, we've delivered nine new connections for a merchant that started working with us just this year. In addition, we often find that new merchants join us to access one specific product, maybe DCB payments, bundling, or digital wallets and A2A. Once they're onboarded, they quickly see the value of our other products, which allow them to reach more consumers through the Boku network, and now, as you've seen, we are delivering new products that will deliver more and more value to our customers. Taking these drivers together, as I've said, our growth continues to come primarily from volume expansion across the entire portfolio. Against that, we do see take rates falling over time.
This will be a result of larger merchants having volume discounts and A2A having a lower take rate, typically 10-20 basis points. These effects are offset in part by the margin on the new products, as I say, like currency conversion, money movement, and accelerated settlement. Despite the fall in take rates, our revenues will continue to rise as the key driver of growth, as we've seen, remains volume in common with most companies in the payment industry. This growth is driving a change in our business mix. While DCB continues to grow in absolute terms, digital wallets and A2A are the fastest-growing products, representing over 30% of group revenues in H1 2025. By 2027, we anticipate our revenue mix becoming more balanced between DCB, digital wallets, and A2A, while an increasing share will come from the new products you've heard about.
Our capital allocation will remain disciplined, focused on areas that generate measurable returns and support long-term growth. Our biggest priority remains organic growth, which has delivered excellent results so far. This investment sits under our Perform and Transform agenda, which you've heard about today, and these items include revenue diversification, including expanding the direct sales team and developing new products, straight-through processing, enabling greater A2A scale and operational leverage, innovation through our Singapore hub, developing next-generation payment products, and new data and technology capabilities to deliver growth and enhance efficiency. We'll also continue to consider capital returns as appropriate. To date, we've used share buybacks into treasury to meet employee share scheme commitments and will consider doing so in the future, and finally, we may consider disciplined acquisitions over the medium term, but only to support the organic growth strategy.
To wrap up, our current trajectory supports market consensus for the full year 2025. And more broadly, we continue to build a business that is scalable and cash-generative, delivers sustained organic growth above 20% on a CAGR basis with Adjusted EBITDA margins over 30%, accreting from and including 2026, all of which provides a strong foundation to lead the global shift towards local payment methods. And with that, I will hand back to Stuart.
Thanks, Rob. And thanks to the whole management team for your presentations. So let me just wrap up the sort of formal part of the presentation by just reminding you of what the key takeaways are. We're growing fast at a top line, and we're facing into a much larger and very exciting global opportunity. We have a clear strategy to win and to target that opportunity.
We continue to be proud to work with some of the largest tech merchants, and as Mark said, both existing and the to-be global tech merchants of the future. And within all of that, we've created an incredible network of over 200 LPMs across 60 countries. So look, thank you for your patience. We're all going off to do some clicker training after this once it's done. But that concludes the formal part of the presentation, and we're now going to be available for some Q&A. I know you've been waiting for this bit. So if I can ask the management team to please grab a stool. At this point, I would also like to introduce our Chief People Officer, Vic Rogers. Vic, give everyone a wave at the end there.
Hi, I'm Vic Rogers. I joined Boku 18 months ago, and I have a background in e-commerce and brand management, retail, and digital entertainment, and what a joy to be here today. What a story we've heard, and clearly, very proud to be the Chief People Officer at Boku.
Thanks, Vic. So before anyone says it, no Girls Aloud and Boy zone have not joined up together to do a one-off gig. We are open and ready and await your questions. So who wants to?
We've got a roaming mic.
We've got a roaming mic. So please, if you could let us know who you are, what organization you represent, and then fire away. Hannes, we know who you are.
Thanks for the presentation. It was very impressive. I got two questions. I could ask many more, maybe to Paul. The first thing is it was very interesting to hear more about the money movement and the effects in the treasury. Maybe just help us understand why, for those partners you have as those global merchants, why you think that you are better positioned to move the money and why wouldn't they do it in-house. And then maybe the second part of that question is, could that be a standalone product where, for example, one of those global merchants say, "you take over the flows for us"?
Yeah. So look, I think a lot of the merchants that we work with have large treasury teams with highly sophisticated capabilities. You would be surprised, though, that they don't cover all of the markets, especially the more emerging and frontier markets. And also, the commercial pace of these organizations sometimes works a slightly different pace to that of their centralized treasury functions. They need to be able to launch quickly, and they need partners who can move money with the right licenses, who can provide the security that we do in terms of the quality, in terms of our licensing, and the way that we build our money movement product effectively and efficiently for them. So I think, yes, there will be some currencies, for example, where larger merchants will want to manage that on their own.
I think there are many, many that will see this as an opportunity to outsource this, knowing that we provide a highly transparent but competitive service, and we deliver that efficiently with faster settlement to them. So I think there's a big opportunity for us to do a lot more in terms of money movement with those merchants. And on the second point, absolutely. I think I mentioned the fact that the money movement platform enables us to be able to offer merchants this modular set of services. Now, that may be that a large e-commerce retailer wants us to be able to deal with refunds and the risk around those, and we manage the foreign exchange for them in a certain currency pair. We don't necessarily need to do the collection of those funds to be able to do that.
So I think there is a huge opportunity for us to be able to provide local foreign exchange capability and using some of our liquidity products, for example, to get trapped cash out of countries. You would be surprised how prevalent that is in some of the large organizations that we work with. And I think that opportunity to be able to diversify and offer services that aren't necessarily related to our core collection capability is going to be important going forward.
Thank you for that. And the second question is around just the margins. In terms of margins of all those new products, especially payments marketing, how do you structure those prices, and how should we think about the progression as those products ramp in terms of margins? So maybe it's Adam.
Do you want to take the payment marketing question?
Yeah. I mean, I think with specifically the payment marketing, I sort of see that as something that will be an add-on to the payments. And so traditionally, payments has been ad valorem priced. And if those transactions had come through one of our sort of payment marketing campaigns and channels, you would just basically add points on top of that. And so it's sort of its margin accretive.
Hi, everyone. Alex Short from Berenberg. Thank you very much for that presentation. First one for me, I guess Boku is differentiated in terms of, well, in several ways, but particularly in terms of the degree of customization that you're willing and able to make with respect to the technology, but also your very high customer service levels. How do you maintain that point of differentiation whilst also adding 50 or 100 new merchants and expanding quite aggressively, I suppose?
Leila, do you want to talk about how we operationalize our go-to-market?
Sure. I think, thank you for your question. It's something that we have been looking into, or certainly I have over the last five months as I stepped into COO. I spoke about trust, and it's really important as we're looking to scale that we are continuing to deliver on everything that we've been known to do previously. So continuing to have the same quality of service, providing that value. So for me, as we are making these deliberate choices about where to invest and where to improve, we need to be measuring the right KPIs in order to track that we're doing it properly. So it's not doing it quickly. It's doing it efficiently and making sure we're doing it deliberately.
There are a host of different things personally that I want us to be prioritizing, but it's important that we're looking at where that has the biggest impact on the business and focusing there first. So on my side, from a compliance perspective, we need to start there because we have to have the same robust checks and balances in place to go into these markets properly, compliantly, reliably, without taking any risks or reducing those risks. So we're looking at how to scale that up, how to automate it, have a more smoother, consistent onboarding for our merchants while keeping the same checks and balances in place. But it's a great question. It's what we are focusing on right now.
Great. Thanks. And then the second one, I can't remember whether it's for yourself or Keegan. You spoke about 64% of legacy connections being upgraded this year. How frequently does that need to happen? Essentially, what's this sort of associated maintenance burden with modernizing these connections?
Leila, that was you.
Yeah, it was. So the 64%, this is our legacy Fortumo platform, and we acquired Fortumo several years ago. So we are actively migrating the connections from that platform over to the Boku Platform, our premium product. So we've been working on that throughout the year, and we will complete that by the end of this year. But more generally, we have to maintain our connections. It could be that an issuer has a new API that we have to upgrade, and therefore we have to implement that. It could be that there's new features, functionality that comes through that we want to prioritize because of the performance. So for our operations, we do need to ensure every year a certain part of our resource is working on those upgrades. But the 64% I spoke to is very specific to migrating from the Fortumo platform.
Great. Thank you very much.
Hi, guys. Harriet Singh is at the back. Just a question about connection progression and sort of cost-benefit analysis in that you work with some of the largest merchants at the moment, and I guess you've connected them to some of the largest local payment methods, and you get good bang for the buck. But I guess as you kind of think about smaller merchants, and I'm just thinking about, right, okay, how do you make that actually sort of economical and attractive for both parties, given you're going to get less TPV for kind of a similar cost? And therefore, how do you reduce your costs in accordance with probably what would be smaller incremental TCV such that actually it makes sense for smaller merchants to connect to the same number of LPMs as the larger customers do currently, such as this really scalable model for the longer term?
Yeah, no, I think it's a great question. The way I would separate it is for our very largest merchants, a lot of the effort goes upfront into us integrating into the merchant APIs. So a lot of the work is front-loaded, and then the job is really about connecting new local payment methods onto that API. With the extension of the merchant base, the plan is very much to take those existing connections from the LPMs and offer them to new merchants via Boku's one API. So there's a different model here. So as you come down from the largest merchants who want us to integrate to them, for the rest of the merchant population, they will integrate into us, and that's where we get our economies of scale from. Does that make sense?
Hi, Tintin Stormont from Deutsche Numis. A couple of questions for me. I think this might be for Mark. I think during your presentation, you were talking about when we were talking about new merchant logos, kind of watch the space Q1 2026, hopefully some good news there. What does success look like in terms of new logo acquisitions? It could be you, could be Stuart.
That's a great question. Success to us is really kind of answering the question above there as well. It's that once you've actually got these connections to the LPMs in place, it's much more cost-effective to get the second, third, fourth, fifth merchant on there unless they've got very bespoke requirements, as some companies do. And so for us, it's really kind of like the throughput of deals that we're getting is one metric that we want to see. We want to see a higher deal velocity. The other thing is that we want to see the time to revenue be greatly reduced. So really, we'd like to see the time to revenue of these new merchants around about 50% of the time of what our existing merchants have been. So that's a second factor.
The other one as well is how we successfully open up new verticals as well. We don't just want to kind of mine one area. We want to mine multiple areas at the same time at speed, and we want to do it quickly. They're the three success factors that we see.
Should I go?
Yeah.
Okay, cool. Thank you. Thank you, Stuart and the whole team for a lovely presentation. Melvin from Sterling, yeah. Two questions. One is a small one, so I'll go with that first. In terms of the take rate of four basis points, are we willing to basically reduce that because we are chasing kind of volumes and kind of lay the pipeline and be the first to move?
When you say take rate of, sorry, did I understand that you said take rate of four basis points?
Yes. That is what your slide showed, right? Rob, did I miss it?
That was the movement.
Movement, yeah.
It was the increase of four basis points.
So sorry, let me rephrase the question. Where do you see the take rate kind of going in terms of moving? Is it kind of going to go up, down as the volumes grow?
We do see the take rate starting to go down as the volumes go up. I think it's normal payment company dynamics. We are looking, as I hope we showed, to process more and more and more volume, and we do see that resulting in a lower take rate over time.
Thank you. And the second question was I saw you showed India on the map, Mumbai. That's where I'm from, so I love that chart there. But particularly, and this is for anybody really, Stuart, is that if you could answer the question, India, China, and Africa, which I think is a huge market and kind of payment systems are jumping systems there. So yeah, if you could just talk about these three big markets, that'd be great. Thanks.
Yes, I'm going to get Paul and Adam to comment on this one rather than me answer it. I think Asia is a big place, right? So I think maybe we just pick a few. Do you want to talk about India, Paul, and then Adam, maybe Africa?
Yeah, I spoke a little about India already. I mean, I think UPI is one of the standout use cases for kind of government-backed real-time payment schemes globally. The fact that they've been able to drive such a huge user base in such a short period of time is kind of testament to the investment from the government and the central bank and the fact that the way they've got users to proliferate the number of use cases for UPI. I do think, as I also mentioned, that it is very much a domestic payment rail still, and the cross-border opportunity for UPI is very much in front of us. While there's various schemes running over the top to increase its kind of interoperability, I think the big increases are going to be due to companies like Boku building that conformity and offering those money movement services to merchants.
I think the big opportunities in India are just starting, and I think we'll see lots of global corporates looking to companies like Boku to be able to access that market via UPI.
Anything to add on Africa?
Yeah, I mean, Boku's coverage strategy is somewhat, it's not necessarily us deciding. What we're doing is we're just following where the local payments are emerging, where adoption is high and growing. And so we started in Asia because that's where a lot of the activity was. But now what we're seeing is Middle East and Africa starting to pick up on the same exact technology, same exact sort of campaigns and schemes. And so I think Middle East, Africa is actually the next big kind of emerging market for local payments and digitization of cash and more e-commerce.
Yeah, and we see in Africa in particular, a lot of those African markets skipped cards entirely, right? They went from cash economies to digital wallets. If you think about wallets like M-Pesa in Kenya, huge penetration across the country. So for us, those are clearly going to be important markets, and we're expecting lots of merchants to be interested in accessing those LPMs in the coming kind of months and years.
Hello, my name is Mahir Bidani from UBS, and so two questions for me. For your kind of off-the-shelf version of the platform, the single API, how are you differentiating versus your competitors? Are you still able to offer higher conversion rates despite not doing the bespoke connections? And the second question is about the concentration of your volumes among LPMs. Is it spread across your 200, or is it quite concentrated within a few?
All right, that's probably a combination of Keegan and Adam. Who wants to take the connections question?
The first one. So as Adam spoke in his presentation, we focus heavily on tokenization and differentiating on a feature set and adding. We've led the market on adding tokenization to wallets, working on building features on top of it. We leverage what we do with the big merchants to be able to go down market and reuse those. So our existing API, we actually built in conjunction with one of our largest merchants, and then we've reused it for the smaller ones. And so that reuse allows us to both get scale and maintain those features. Anything to add?
Yeah, I mean, when we say that we provide bespoke capabilities and bespoke kind of levels of service for our mega merchants, it's not because the product is fundamentally different. And so as Keegan said, the functionality is still all shared. It's just the way we interface with those companies is a bit different. It's a bit more white glove. I think your second question was just the distribution of volume. It's definitely not even. And the variables that sort of determine what the volume is, is as much about the per capita GDP of the population, competition from cards, and also just the popularity of that particular product and service. And so a good example might be we see a lot of volume in Japan. Is that because local payments are super popular in Japan?
If the volume is coming from mobile gaming and Japanese consumers are very, very happy mobile gamers, then you're going to see more volume there. In other situations, it might just be because there's absolutely no competition from cards, right? And so consumers, let's just say in Hong Kong and Greater China, there's no competition from cards, and all of a sudden, you see a lot more sort of volume. So it's multivariable in terms of how the volumes are spread out.
Thank you.
It's Gautam Pillai from Peel Hunt. Can I ask about the reverse integration into merchants you talked about? Is it right that the traditional card-based processors typically wouldn't do that? And what does it mean from an onboarding standpoint for you, from a timing standpoint, as well as a lot of customization required for kind of reverse integration? And would you say that merchants would like this aspect more?
Good question. We've built the platform in a way that enables us to easily add these reverse integrations focused on merchants. We identified this fairly early on, particularly because of Google, and we built it out so that we could add them on without having to completely redo the platform. Some of our early competitors built them bespoke for each merchant, and what we've done is we've isolated those differences to the edges of the platform so that the core remains the same, while allowing us to plug in those on the side. They do obviously take longer than an off-the-shelf integration, but we have a team focused on that, and they can deliver those pretty quickly, and while they are different, they tend to share a lot of similarities, so we've gotten pretty good at being able to do that.
It is a feature we typically only offer to our largest merchants because it does have a slightly higher cost, but it gives us a lot of value also and provides a lot of value to those merchants.
We probably have time for one more question. It's the battle of the analysts here.
It's your colleague, Damindu. You need to sort of pass it on.
On the FX and cross-border business, I had a follow-up on. So, who do you typically replace in a mega merchant? Is it still an in-house system, or would they be using another vendor? And does it mean that you are now being exposed to a different set of competitors than from the traditional payments processing business?
Yeah, that's a good question. I would say actually that often we're replacing banks. There are a lot of major banks that are charging hefty FX fees, especially in emerging and frontier markets. And the foreign exchange and payments is evolving to catch up with institutional foreign exchange. And those levels of transparency just will not suffice for global mega enterprise merchants. And you heard me talk earlier about the fact that we're not trying to hide margins. We're providing a competitive price, but transparent solution. So I think for us, yeah, there are legacy banks who were running these platforms or running these foreign exchange capabilities previously. There are other PSPs who are also sometimes in the payment flow. But generally, it tends to be banks, or if it's moving from cards, it would be scheme FX, which is, let's just say, reasonably uncompetitive in its format.
So a lot of the time we're replacing banks. Sometimes it's other PSPs, or occasionally it's actually the issuer. So the underlying payment wallet is providing the foreign exchange. And these guys are not experts in foreign exchange. These are companies that have built a digital wallet, right? They didn't think about being a cross-border foreign exchange provider as well. So they tend to do it, but only to a certain degree of quality. We're taking that by building out our banking network and creating these kind of deep liquidity pools. We can compete with anyone in foreign exchange, but we also have the added value we bring through the money movement capability. So we can settle faster. We can offer solutions for trapped cash, for refund risk, all of these things. It's a much more holistic solution than any one of the banks or brokers or issuers are providing.
All right, thank you. Go on, Damindu.
Sorry, this one is for Paul. I mean, you talked about one billion being in-house in terms of FX settlements. Obviously, you look at Boku's pool. There's double-digit billions available over the course of time. And I guess lots of investors here have seen listed companies in the U.K. actually make really good money by taking that settlement away from banks and offering a better service. What triggered my question, though, you mentioned the word payout. I mean, obviously the advantage that you guys have here is that you have the merchants already available. The Boku story has always been about pay-in. Does the word payout mean more than just it sitting there? Is that like a doubling of the opportunity? Whichever one wants to take it. Also, maybe describe the difference as well for the audience, please.
Sure, okay. So I think payouts are a huge opportunity because it's something that we know that our merchants are actively doing. And what we also know is that our merchants are very large, often fragmented companies. And sometimes one part of that organization will be collecting for ad revenue. The other will be paying out content creators. And they don't have the capability necessarily to net those flows in their own organization. Boku can provide that solution to them. And I think that's a huge opportunity that we're looking at. And we're building this out in Singapore at the moment. So I think the payout use cases are kind of clear. That could progress into more standardized B2B payments or B2C payments over time. Our initial use case is very much around our kind of core merchants at the moment.
Obviously, if we are collecting funds and we're paying out funds, then we will be internalizing and capturing FX spread, which is obviously great for us and can boost revenue considerably. I think given the kind of diversity of the markets that we're in, we should expect that this could be relatively profitable for Boku over time.
All right, well, we're going to have to draw a line at some point. Thank you so much for all the questions, and thank you for coming. Appreciate all the engagement. The management team are going to be available upstairs on the ground floor for a few sort of social drinks and canapés, I think, as well. So if you're able to stick around, come talk to us. And thank you again for coming, and safe trip home wherever you're going back to. Thank you.