Morning, everyone. Thanks, very much for your attendance again. We will be presenting our 2025 results. As always, if you've attended before, please post your questions as we're giving the presentation today. On the left-hand side of your screens, you can see where you can post questions, and we'll attend to each of them at the end of the presentation. Thanks. We've had another great year. We're all very proud to be presenting these numbers. Our trading profit for the first time has gone over ZAR 1.1 billion, and for us this is a milestone foundational year for the group. Across both our revenue, which is up 23%, and our PBT, which is up 43%. Really a strong set of results.
Our retail team has had an operating model change during the course of this year, and this has precipitated a lot of changes and restructurings within the business. Chris and Paul will both chat to you a little bit about this. Our fintech divisions, which follow the brands FinChoice and PayJustNow across a number of verticals, has had a really strong year and comprises 93% of the profits for the year. Our headline earnings are up 40% for the year at ZAR 5.50, and our dividends again also up 36% to ZAR 1.32. I wanted to spend a little bit of time talking about what we see as our growth drivers and what has actually given some of this growth over the last five years.
Our compound annual growth rates are strong across both our top and our bottom line. First and foremost is the customer. She's an urban African woman, very tech-savvy, and we see her as being the primary driver of our growth. We've had a 40% growth in this customer base in the last year. I've always spoken about that she's female. 70% of our customers are female, and you'll see on the right-hand side, credit active females has been the fastest growing segment within South Africa in the last year. This segment has grown at 15%, 2024-2025, and that compares to the overall market at 12%.
From a market opportunity, we currently have 18% of the total addressable market in South Africa, and we feel that we have a lot of space to continue to grow, in particular with this segment focus that we have. The second growth driver that we see is really important is the structural shift actually towards digital payments. That's both a global trend and a trend in South Africa. There are two elements here. The first is digital wallets. So in South Africa, we're forecasting about a 35% growth in digital wallets during the 2026 year, and this just follows the fact that this trend is happening globally with over 50%-80% of millennials having used digital wallets in the 2025 year.
Buy now, pay later, which is what our primary product within our PayJustNow business is going from a niche to mainstream globally, with 60% of all shoppers globally having used a buy now, pay later product at least once. In South Africa, that's echoed at 45%. We're lower, but we're definitely following the global trends. At the moment, from a digital perspective, within our market, we only have a 1.7% share of the card markets in South Africa. Again, a lot of growth, and you can see our transactions on the right-hand side growing very nicely. We're the number one BNPL in South Africa, and we're the number three finance app downloaded on Apple, and the number 10 finance app on Google Play.
Really nice positioning in the market, and we believe that this mega trend is gonna continue to propel our growth going forward. I've spoken a little bit about the customer, but we also have a B2B customer, our merchants, and this is the third driver of our growth. We have a flywheel with our customers, our B2C customers on the one side and our B2B customers on the other. It's our merchants ultimately that have given us all of our customer growth. We had just over 20% growth in merchants. We're focusing on the tier ones. We brought on a lot of tier ones in 2025, and we're going live with a couple more in the first quarter of 2026. Nice growth in our points of presence.
As we give payment products to our merchant partners, and offer marketing as a service and checkout as a service, their customers come on, and then we offer, first of all, a payment product, then a loans or an alternative credit product, and they move through our ecosystem of product offering. In terms of what our edge is, for us, there are five elements. The first is the brand trust. We've got very high customer acceptance across both the PayJustNow and FinChoice brands. Our NPS scores in both businesses are above 4.6. I've spoken about our deep segment focus with the customer and how this is one of the fastest growing credit active customers in South Africa. All of our tech is proprietary. We've got proprietary data and very deep knowledge within this urban female African base.
We've got a 40-year heritage of risk decisioning within this space, and that stands us in good stead as we move into the future. We've got a number of our products are embedded within our ecosystem. This is a driver of one of our growth and is a strong moat as we offer products to our customers. Finally, we have full control of our entire tech stack. If customer is one of the biggest drivers of our growth, what we're offering her in terms of our product innovation is actually what accelerates her engagement with us across the platform. If I go back over the last 15 years, it's this product innovation that's ultimately driven how often she comes onto one of our platforms and how often she takes up a product.
In our first phase, you know, we went onto our digital loans, we launched a new insurance vertical, we launched our wallet, we acquired a payments business, launched more insurance products. Our phase that we're in at the moment is all around building this ecosystem and driving the cross-sell strategy, and Sean will chat to you a little bit about how we drive cross-sell across the base. We've continued to launch new products, and we will continue to do so in 2026. It's this product innovation and creativity that ultimately brings her back because we're designing products for her that meet her needs. You can see this strategy is really playing out in some of the numbers on the right-hand side. 70% increase in app users.
Over 50% to 7 million digital transactions year-on-year. Really a very, very vibrant product acceptance with our customers. The thing that underpins or that actually creates the competitive advantage for this product innovation is how our teams have driven excellence around our user experience and our conversion. We've been almost fully digital for more than 10 years within the Fintech business. More than 95% of our transactions with our customers are digital. We do have voice to support the experience, but we are primarily a digital organization, and that demands excellence in a user experience. From a profit maximization, it's actually ensuring that it's a frictionless experience and that the conversion is very good. Along the bottom, you can see we continue to make strides in our conversion.
We've done our rebrand, we've improved all of our sign-up flows during the course of this year. We've enhanced our search and discover, and we've launched our new marketplace, our finance marketplace. Across every single one of these elements, we're seeing improved conversion, improved app usage, and improved purchasing of our products. Really nice success in this space. This is what we see as one of our moats and one of our competitive advantages, and is definitely a driver of our growth. Finally, inclusive finance has become a kind of big watchword globally, and for us it's actually just part of our DNA. It's who we are. We've always been in this space. We've always been focused on women and actually driving, giving her access to financial services.
Ecosystem going forward is actually how we're gonna be driving and expanding our customers' access to products. We have six verticals, four of which are currently in our ecosystem today. We've got very deep knowledge and understanding of lending. This is a complex area to get right, and this is, you know, just a part of what we've been doing for a very long time. We help our customers seize opportunity in this space and overcome her life's challenges. Insurance, we see as insulating her from life shocks. We've rolled out a number of new products over the last couple of years, and we'll continue to do so.
It's a very important vertical for us and for her. Payments is the vertical that's really driven viral adoption of all of our— across our ecosystem, and is the entry point into the ecosystem for us. We've got a couple of payment products, and we're launching two more during the course of 2026. Then finally, our fourth vertical that we're live is our shopping destination. This helps her discover new and exciting stores and get access to great deals through our merchant network. Then finally, Sean’s gonna chat to you a little bit more, but our new engagement strategy is our MVNO and our rewards program that we'll be launching. Then Wealth is a product that we'll be like we wanna be looking at in 2027 and 2028. These are the verticals as we see them today.
Each of these elements are growing distinctly, and we're very excited about the growth across each one of these verticals, and Sean's gonna tell you about our plans, both in terms of what we achieved in 2025 and what'll be going forward into 2026. I'm gonna hand across to Paul Burnett now, who's gonna chat to you a little bit about in a bit more detail about our financial results. Thanks, Paul.
Thank you, Shirley. I am very excited to speak to this year's results. Revenue up 23%. Trading expenses well controlled, only up 11%. That's converting very well to our group profit before tax and our headline earnings per share, both up above more than 40%. How have we driven this improved margin enhancement? We've done that in very specific ways. We've targeted high margin and cash generative fee revenue. We have a very low cost of acquisition of customers. We also have high retention of customers and very consistent credit risk management, which we have a strong track record in. We are a digital business, so we keep generating margin enhancement from scale benefits whilst at the same time investing in our tech and data in a very controlled manner.
It's these deliberate strategies that we've actually now driven for some years now that are converting this high growth into improved profitability and high returns. Very pleased with these results. If we look across at the detail in the P&L, it's the Fintech business that's driving the higher revenue. Fintech revenue up 36%. Fintech's fee revenue is now 37% of its group revenue, so that's improved by 100 basis points year on year. The debtor costs reflect two underlying businesses. One, the Fintech business has taken market share. It's focused on its existing base of customers with a proven payment record. On the retail side, they've had some challenges in terms of high-risk business written and in the collection space. Both Sean and Chris will elaborate on these in the Fintech and retail sections.
As mentioned, a great piece with how we've managed our trading expenses to up 11%. The retail business has restructured its cost base. That's come down, and the Fintech business continues to benefit from scale as well as investing in a controlled way in tech and data. You see some of those benefits coming out in 23% higher revenue per employee and a 28% lower cost of servicing group customers. Great to see those improvements coming through. What that then translates into is a 260 basis points lift in our trading profit margin. Very pleased with the margin enhancement that we're driving. It's notable that retail's lower profitability and lower returns has resulted in us recognizing a one-off non-cash financial assets impairment in the business that's in accordance with the International Accounting Standard 36.
Chris will elaborate that under the retail section as well. Standing back, revenue up 23%, converting really well to profit before tax increasing by 43%. Great conversion and margin enhancement being driven. That leads us well into how we've actively managed capital as a business. We've spoken to retail's lower profitability and returns, and how they're well below the Fintech business. Sean's touched on the restructuring that's needed to happen in that space, and that business now needs to be driving cash and double-digit margins going forward. We won't be allocating further capital to the retail business going forward. The costs have been reduced. We've generated cash from the balance sheet, and as mentioned, there was a non-cash one-off impairment that's been processed against retail's non-financial assets.
We've continued, however, in the Fintech business to leverage that business and to allocate capital to Fintech, and I'm delighted with the results that we're starting to achieve there. Similar to last year, we've invested ZAR 1.4 billion in the growing and profitable Fintech book. We've invested CapEx in tech and data, and Sean will speak to some of the exciting developments in that space. This does require funding, so we are delighted with the relationship that we have with our lenders. We continue to have good support from our lenders. During the year, we refinanced and upsized our funding by ZAR 1.25 billion.
We ended the year with healthy headroom, ZAR 1.5 billion of cash and available facilities, and we are actively engaged with our lenders in terms of our short and medium-term funding plans. We are considering a notes program in the future as well. What is this active capital management translated into? We're seeing a 370 basis points lift in the group's return on equity, now at 14.7%. Very pleased with the results that we're achieving there. Lastly, I'm gonna speak to why we are doubling down on the Fintech business and why, well, we've been allocating the capital to the Fintech space.
Consistent with what I've shared in previous years, we continue to collect more than what the outflows are on the Fintech portfolio. ZAR 15.2 billion cash collected off the Fintech book against outflows of ZAR 14.7 billion. How have we achieved this? We've continued to drive profitable fees and cash generative fees. The Fintech products are short term in nature, so we're getting a good return on them. We've got a track record of actively managing our cash as we grow new products as well. A great example of that was investing in PayStretch of ZAR 200 million of this year's and still managing to balance our funding well within our guardrails. What's the outcome of this? If you just look across at the top right-hand graph.
I'm delighted that the yield on this Fintech book is now up at over 200%. What does that mean in simple terms? We've collected ZAR 15.2 billion of cash off a closing book balance of ZAR 7.4 billion. More than double the closing book balance has been collected. If you also look on that top right-hand graph, you can see the benefit that we are receiving from a cash point of view in terms of higher fee income as well. If you look at the gray segment on the far right-hand graph and how we've grown that. What's the outcome of this active capital allocation? It's fantastic to see that the Fintech business has grown its return on equity by over 600 basis points.
It's up at 27% for the year ended 2025. We're gonna keep targeting that enhanced return going forward as well. Standing back, I'm delighted with the results that we've achieved. As Shirley mentioned up front, it's been a milestone year for us to achieve trading profit of over ZAR 1.1 billion. We'll keep targeting margin enhancing initiatives. I've shared on what some of the drivers are achieved and then on the track record that we're expecting going forward there. I'm delighted with our active capital allocation and the step change in shareholder returns that's been achieved. Really pleased with this year's results.
With that, I'm gonna hand over to Sean Wibberley, the CEO of Weaver and of the Fintech business. Thank you, Sean.
Thank you, Paul. Again, I'm really pleased to be about to present the Fintech division's results to you. I'm gonna take you through the financial performance, then a brief view of our ecosystem and how our flywheel works, then a deep dive into how we monetize and grow our various verticals in the ecosystem. Looking at our results, I'm gonna be repeating a bit of what Paul said, but I think it's worth it. Revenue up 36% to ZAR 3.4 billion. Fee income growing at faster than revenue in general as we increase the returns from our fee-generating verticals, namely insurance, the growth in B2B, and the strong growth in our payments business.
Our trading expenses are down, due to the scale with which the business is operating and our tech and data investment, as well as the lower cost of acquisition due to cross-selling within the group. All translating into PBT up 40% to ZAR 784 million. We have about 1.3 million active transacting customers in our ecosystem right now. Taking you through the P&L. We've seen great growth across all of our verticals. Lending up 20%, our payments business up 80%, and insurance up 21%. Revenue up 36%. Our debtors costs grew marginally more than revenue as we continue to drive market share, pushing much of our disbursements onto existing customers. Our new PayStretch or Pay in Twelve product grew over 5x in terms of its book last year.
We launched that product 15 months ago, and we began to scale it last year and hold appropriate provisions on that growing book. Trading expenses down 110 basis points and a 60 basis point improvement in our margin. You can see our efficiencies. We're generating now over ZAR 5 million worth of revenue per employee in the Fintech business, up 21%. Looking at credit, despite our high growth, we continue to maintain consistent credit outcomes in the business. As Shirley mentioned, we've been in the mass market female credit market for over 40 years as a group, and we really are experts in understanding her and the mass market in terms of how we offer credit. This is exemplified in the vintages you see on the bottom left, very tightly range bound over the last five years of quarters.
Ourselves, along with the rest of the industry in South Africa, had to contend with the change in the debit order mandate system. Registered mandates or RM was a new change that caused us some headaches, and we were able to pivot to now over 95% of our customers are on real-time authorized debit check mandates, which is improving our collections. We continue the policy of disciplined low and grow, where we bring in customers on lower amounts on shorter terms, and then extend the amounts and those terms over time based on good repayment behavior. About 88% of our disbursement last year went to existing customers. We enhanced our technology with respect to credit scoring, which is enabling us more flexibility in terms of adjusting policy along the way, as our customers engage with us.
BNPL continues to enjoy debtors' costs less than 2% of GMV. Our new PayStretch product has been grown and tweaked over the course of the year, and I'm very happy with its performance. We remain a relatively short-term portfolio, about 13 months for our lending business, right the way down to 43 days for our BNPL product. Also, we are relatively short-term in the market. Our lending balances are under 10,000 ZAR, and our BNPL is just 850 ZAR average balance. Looking at the outcomes in terms of stable quality in the portfolio, we've grown our book to ZAR 7.4 billion. Pleasingly, the stage 1 mix has increased from 78%- 79%. We still maintain high coverage of our stage 2 and 3 within the portfolio, and that's now marginally up at 70.5%.
Due to a favorable shift in the mix of our portfolio over the course of last year, our provision percentage, our ECL percentage, dropping to 14.7%. Again, very happy with the stability of our portfolio despite the high growth that we've been enjoying within the business. Let me just look at the ecosystem. Our gateway product, bringing in the customers into our ecosystem, is by far and away the BNPL product. It's a virally adopted, well-loved product. It's free for consumers, and we are booking over 120,000 new customers into BNPL every single month. Last year, the Fintech business attracted 1.5 million new customers and at only a customer acquisition cost of ZAR 57 per acquisition, and that's a downward trend, and we see that continuing further as this virally adapted product continues to grow.
We now have a customer base of close to 4 million, up 9 times since 2021. High engagement and retention, lending at 86% and BNPL at 93%. Both products are seeing high frequency. Seven times a year, customers are accessing further credit from the FinChoice business, and there's an increasing trend of about 5 times customers using BNPL over the course of the year. As Shirley mentioned, both platforms enjoying strong Google ratings with respect to how much she enjoys our digital platforms. The flywheel effect of the ecosystem is one where the revenue we garner from customers increases substantially as the customer takes a second, third, and fourth product with us. The typical journey for a customer would be to come on into the ecosystem on a buy now, pay later product at very low acquisition cost.
Over time, she may choose to elect to the PayStretch or Pay in Twelve product for larger ticket purchases. She can activate a MobiMoney wallet, apply for a pre-approved lending product over 6, 12, 24 or 36 month terms, depending on her loan and grow position in her life stage with us, and then we would cross-sell her funeral and personal accident products. We're seeing that within 90 days, about 12% of our customers are taking that second product, and we see that percentage increasing over time. We enjoyed nice growth last year in terms of 2+ product customers that grew 28%. All this translates to in the bottom right, the outcome, ARPU. If a customer has one product, the average revenue over a one-year period for that customer is about ZAR 1,200.
When she takes the second product, it jumps to almost ZAR 10,000. Then the third, fourth, and fifth product getting to ZAR 18,000. This is the real benefit of our ecosystem. Low cross-sell costs and high jump in ARPU as customers choose to spend more of their wallet in our ecosystem. Let me go into a deep dive now into our key verticals. The lending business, we dispersed ZAR 7.6 billion last year. Almost all of those disbursements done end-to-end by customers via her smartphone. Our app is the fastest-growing digital channel within our portfolio, and that grew very nicely, up 25%. We now have over ZAR 1.6 billion dispersed through the app at very high engagement levels.
She's logging on and using the app almost seven times per month, where she could check her balance, service her loan, and request further extensions to her credit and other facilities on the app. We have just a 2.5% market share in the unsecured lending book in South Africa, so still huge runway to continue taking market share. Our wallet, which is this, is the FinChoice MobiMoney wallet. It reached a milestone where now we're doing over 100,000 wallet withdrawals every single month. I still see this product as being a cornerstone lending product and a highly engaged one which she accesses exclusively from her cell phone. Payments are another vertical I wanna do a deep dive in. By far and away, BNPL being the hero product in terms of acquisition and engagement.
That's the graph on the top left. Since we launched this business five years ago, we have disbursed at the till, in other words, gross merchandise value, cumulatively of over ZAR 13 billion, which represents over 9 million transactions done at merchant tills, both online and in-store. We also reached a milestone last year where the BNPL vertical itself reached. We went into the black and became profitable for the first time. This business has now reached a scale level where it's becoming cash neutral while still driving growth. PayStretch, our Pay in Twelve product, grew five times since we launched at the back end of 2024, and cumulatively, we've done over ZAR 300 million in transactions, again, in real time at the till online and in-store wherever PayJustNow is accepted.
Bottom left shows you that customers who use our products use them increasingly more frequently in following years and have more GMV on an annual basis, as the smart way to shop becomes an entrenched way that she engages with our products and with the merchants that she chooses to shop with. Bottom right, you can see Pay in Twelve average amounts up over ZAR 8,000 for larger ticket items. Pay in Three is smaller at about ZAR 6,000. We are looking to have more PayStretch type terms, so Pay in 6, Pay in 12, Pay in 24, and the team are exploring different tenures to suit the customer's pockets and their type of purchase. Digital, the third key vertical from a consumer standpoint, great growth last year, 32% up in terms of acquisition of policies.
We now have 180,000 customers in force. GMV up to ZAR 220 million at a stable claims ratio of 21%. My favorite slide on insurance is the increasing penetration with which customers are using digital end-to-end to acquire what is typically a push-based product. She is choosing to take the product at almost 50% of the time through her phone end-to-end. Our personal accident product has had a great year. We went from 2,000 policies the year before to 14,000 as we found nice market fit with the pricing of that product. Both products being funeral and personal accident are now sold as FinChoice branded or as PayJustNow branded, depending on which platform the consumer is engaging on.
Merchants continue to enjoy the GMV that we push through their tools from the buy now, pay later product. We are the number one BNPL in the country, and you can see in the top left graph. We did approximately ZAR 7 billion of GMV, the vast majority of it coming from customers who had previously taken out our product and brought their custom to our merchants. Last year, we added a number of new merchants, two notable merchants being Shoprite and Takealot. We brought into our merchant network in Q4 last year. We have 3,450 merchants. This year we want to substantially increase our merchant footprint to add increasing value in the two-sided ecosystem to our consumers and our merchants.
A big notable success last year was we grew our B2B ad spend revenue by 170%. This is where merchants advertise themselves and their products and their deals on our shopping destination. Last year, we showed an average of 158 million impressions of merchant offerings to our consumers each month on our app, of which 48 million translated over the year into leads to our merchants at a very nice click-through rate of 2.5%. Adding real value back to merchants for their ad spend and generating a nice return on ad spend revenue for our merchants. 'Cause you're bringing shoppers with high intent and a credit limit into your world as a merchant, and then they're able to check out to make those purchases.
A fantastic ecosystem virtuous product for our merchants. Looking to the future, we are imminently, by about mid-year, launching our own mobile network. We're calling it PJN Mobile. We are in discussions to join one of the large MNOs and virtualize that as PJN Mobile, where we will offer our 4 million customers access to affordable data and airtime, as well as reward customers with data and airtime benefits based on engagement and loyalty within our ecosystem. In 2027, we're gonna be partnering with one of South Africa's large banks in order to offer a linked debit card, a Mastercard or Visa card, which will give customers very convenient access to our credit and payment products dynamically at the point of sale, thus facilitating even better, more inclusion and easy shopping for our customers.
Later on, once that's launched, we're gonna be exploring investment and saving products, which we are now still in initial phases of considering and planning. Before I hand over to Chris on retail, I just wanted to summarize. This business acquires customers at scale via the BNPL payments product. We cross-sell those customers into high-margin verticals. Revenue has been growing by CAGR of over 30%, as has profits, as has our customers. Our market share in lending is just 2.5%. In insurance, it's less than 1%, and in digital payments, it's about 1.75%. High growth the last five years with a lot of room to continue that growth and accelerate it.
The addition of a mobile network and a card, I think is gonna even further accelerate that. Thank you very much. Chris de Wit, if I can hand over to you to talk about retail, please.
Thank you very much, Sean. I'll be sharing with you our retail results and also an update on where we are in terms of the strategy. Maybe just to start off, both Paul and Shirley spoke about our shift in strategy, especially in the second half of last year. It's really about return on capital and capital allocation. In the second half of last year, because the business has been generating lower market-related returns and lower returns than Weaver Fintech, we needed to restructure the business. The aim really is to deliver double-digit operating margins and double-digit return on capital. We want to be a niche homeware retailer. That also means that we will have lower levels of sales growth.
Paul mentioned no more investing into the retail business until we first establish certain level of returns. Some of the things that we've done in the last quarter, last year, we've rationalized our product categories. We've tightened credit, and I'll share a bit on that in the future slides. Reducing the credit terms is quite key for us because that reduces the asset, and that will help with the return on capital. We shifted our acquisition now is in Showroom, so we've stopped all cold calling from the call center. Because of this, there is a one-off non-cash impairment of assets. On the right, our P&L for the year. Slow retail sales growth.
Strong margin year on year, so we saw an improvement from 45.7% to 45.8%. That translated into about a 30% growth in trading profit. You can see a small improvement in trading profit margin, but really our strategy is to get that into the double-digit range. In terms of credit performance. We had higher acquisition of customers towards the end of 2024. Sean mentioned the implementation of the industry-wide RMS process. The biggest portion of our customers were on RM, so we were impacted by that, and it impacted our collections. But where we are now, we're in about 50% of all our new customers are on an authenticated debit check, and that's really kind of settled our collections performance.
You can see on the bottom left-hand corner the latest data point on the vintage, it's well within our kind of acceptable ranges. Also with the shortened sales term, it's gonna improve our risk and cash generation. All centered around higher margins, and getting back to that double-digit margin on assets. The next slide really talks about our showroom. Our showroom is not only a place where our customer can buy, but it's really an experience and a full service offering, where our customer she can come not only to browse and buy, but she can also do in-store payments. Collections about 30% now of all our collections in store.
We've worked really hard on customer service, so more than 50% of all queries now are resolved first time. About 40% of our customers acquired now from showrooms and our target is 60%. Showrooms really is the front and center for us to acquire customers and to service our customers. They also have a high repurchase rate, and you can see there on that top right-hand corner. In terms of the last, the last that I want to share on the last slide, our strategy is the customer comes in through a showroom, and then, you know, we want to convert her or help her really in the experience to buy and engage with us, digitally.
What we've done in the last year in terms of chat commerce and automation, all our customers now receive an order confirmation. Now what that does is that really helps us open a form of communication with the customer where they can query a balance, they can make payments, they can get a catalog, they can engage with us, and they can even buy from us. Through chat it delivers a 25% conversion versus 19% on voice. We really believe that this is the way to go for our customer. We're also leveraging technology and AI by improving our customer service, but also the cost of operations, increasing the average number of sales per agent, but also the reduction of costs going forward.
Really a key pillar of our strategy going forward and combining the showroom with the digital. I'm now gonna hand back to Shirley. Thank you very much.
Just looking forward, in terms of how we see the business, both Sean and I have spoken about the market and the market itself, offering opportunity. We have low penetration within all the verticals that we currently work in, so we're excited about the opportunity in terms of the space that it leads us to grow. Our merchant relationships are key in terms of how we're gonna be attracting new merchants, and we've actually called 2026 our year of the merchant, because we want to recognize how important they are in terms of propelling our business forward. We're very clear that all of our fee verticals are actually our fastest-growing verticals. It's important for us, and long-term, we wanna take it from the current 39% to 50%.
Digital is just the backbone of our business, and we invest in that way to support digital because it drives our profitability. Our retail team is clear. They've had a big shift in their operating model, and they're very clear on their strategy and their focus on the return on capital. We're targeting a 30% return on capital going forward, and we're confident we're gonna be achieving that in the next year or two. Finally, from a trading perspective, our strategy is continuing to grow at similar levels to our 2025 year. Our disbursements are currently up 18%. We're seeing strong growth across both of our payment categories, up 87%. Our customers are showing strong growth at 8%, and our insurance vertical is also very nicely.
As we stand at the end of February feeling confident about our year and very excited about the changes we're gonna bring into the space for our consumer. Thank you very much for your time this morning. We do appreciate it. We'll now be going across to take any questions. If you remember, please put them into the chat and we'll be answering them as we go. Thank you. Thanks. The first question, Sean, is for you. Why are you launching PJN Mobile? It's a very crowded space.
Yeah. Thank you, Shirley, and thanks for the question. Yes, it is a crowded space in the market. However, we have an audience of customers of 4 million and growing at 120,000 a month, and we believe we can offer much more affordable airtime and data packages to those customers and then reward them for their engagement within our ecosystem by offering free data and airtime based on behavior and engagement in our ecosystem. Making the engagement of our customers and their behaviors on our ecosystem rewarded and more beneficial.
Another one for you. How does Weaver align with market opportunities?
Yeah. We've seen fantastic growth in our current lending, payments, and insurance verticals, as you would have seen.
We still have a very low market share across those verticals, around about 1%-2%. We see continued growth and depth as we continue innovating in those verticals. We are gonna be expanding, as I just mentioned, into our PJN Mobile, into broader bank-type services. We don't want to become a bank. We will be partnering with a sponsor bank, but we will be offering utility to customers that befit the ecosystem. We believe we understand our market segment and the female bias within it, and we have been creating products that are transparent and engaging and service her needs and, you know, the past speaks for itself, and I do believe there is a lot of growth and a lot of market share we can continue to take across the spectrum in our ecosystem.
Thanks, Sean. Paul, one for you. Can you break down your wholesale funding sources, for example, bonds, interbank funding, repo markets, and institutional deposits?
Thank you, Shirley. Yeah, we've got a mix of bank funding and institutional funding. We are looking at a notes program in the future.
Another one for you, Paul. What's the proportion of funding in terms of short versus long term?
Again, Shirley, thank you. Our funding terms range between three and five years. We've recently extended that repayment term to three and a half years. This is quite conservative compared to the term in our book, which is well under two years. Yeah, we consistently refine it well in advance of a 12-month repayment. That's how we manage. The term is quite conservative, Shirley.
Staying with funding, how do your liquidity ratios or liquidity coverage ratios and net stable funding ratios compare to regulatory requirements?
Shirley, there's no regulatory requirement, as we aren't a bank.
Another one for you, Sean. Excellent growth in the BNPL business. Do you have any concerns around upcoming or potential legislation that could regulate this business, similar to the NCR?
Thank you. Just a sound check. Can you hear me?
Yes, we can.
Great. Thank you. Yes. The regulation in the BNPL is, has been mooted to come to South Africa. We follow the international markets. In the UK regulation was tabled and will be promulgated in the middle of July this year, and that regulation seeks to require BNPL providers to firstly serve up their transactions to the credit bureau. We will be doing that along with the other BNPL providers in this country at the end of March. There've been some delays, but nonetheless, we're going forward as an industry at the end of March to report on all BNPL transactions. This will give more visibility into the product portfolio across the country. Looking at other questions raised around proportionate digital affordability tests done to prevent customers from stacking and getting into trouble by overusing the product.
We believe we are very good at what we do here, and we limit customers in terms of the amount of transactions they can make simultaneously, and we follow their behavior, which is why our bad debt rates are less than 2% of GMV. We closely engage with the regulators on the COFI Bill. We are part of the FINASA, the Fintech Association of South Africa, who are closely engaging with the payments and regulators around what's gonna be coming, so we can make sure and lobby that we have the appropriate regulation coming in the coming years. I imagine regulation will come in the next one to two years.
Chris , a question for you. What are the core strategic focus areas for retail in 2026, and how has the retail business started off this year?
Thanks, Shirley. I mean, the main thing, as I alluded to earlier, is increasing our operating margin. We want to get that back to double digits and also the return on capital. Really two things. One, we've got to get the profitability up and getting the profitability up, we've got to reduce the size of the asset, and that will help the return on capital. Some of the key things that we are doing is we're reducing the term of our lending book by about four months, and that will help with the return that we generate. We have tightened the credit so that we have superior credit quality that will also enhance the earnings.
We've done a restructure towards the end of last year, and that's starting to yield some really nice results. We've rationalized some of our product ranges to optimize our margin and our supply chain. First few weeks of this year, our strategy is landing quite well. We do have some pressure on the top line, but that has been necessitated. As I mentioned, we'll reduce, you know, the top line to make the asset a bit smaller and increase the return.
Thanks. Thanks, Chris. A question for you, Sean. The rand price of oil is up more than 50% in the last few weeks. How have you adjusted your lending criteria to mitigate increased risk?
I didn't hear the first part but just read it now. Yes.
Okay
With the oil price up around $115 now, I believe. It may be that way for a while. That's going to downstream impact customers' wallets and hence their affordability. What we will be doing is, as we've done in many crises like this, COVID being a big one, we work with our customers when they're applying for credit. We assess with the customer if they are under financial difficulties or is feeling strain. As a result of that, mitigate by reducing loan amounts. Of course, our affordability assessment is done each time a customer applies for credit. We would assess their earnings and their available to spend.
We have products that allow customers who find themselves in a pinch to apply for skipping payments and to reduce their payments or to go into a restructured product. We're very good at working with customers through the ebbs and flows of tightening credit cycles. We will do much of the same and obviously keep a very keen eye out on what's going on with the oil price and Iran in general.
Thanks, Sean. Another question for you. Has the Weaver model matured enough for the business to be considering expanding into card and mobile?
I believe so. We've been in the lending business for about 20 years under the FinChoice brand. We have been in the payments business now for five years. The PayJustNow PayStretch product allows payment at the till that's integrated into the PJN network. We believe adding a linked Visa or Mastercard with the sponsor bank is gonna really facilitate and ease customer transactions at the till. We've seen this globally. Customers like the convenience of embedding a virtual card into their smartphone and tapping and paying at the point of sale. We wanna give that functionality to our mass market consumer whilst having our credit in the background servicing her in the way we've done for several years now.
I do believe we're at that point now where we can start becoming a broader based financial provider to our customers.
Sean, there's another question on asking how customers are responding to the new Pay in 12 products and what other payment products will be launched this year.
Yeah, as I mentioned earlier, we have a Pay in 12. A customer needing to buy a larger ticket item that she can afford over 12 months, that's in play right now. The team will explore different terms, 6 months, 18 months, 24 and so on. The customer can then self-select which is the appropriate term for what she's buying to make it more affordable and obviously within our risk tolerances. We're also looking at different terms on our buy now, pay later product. Right now, it's a Pay in Three. We'll be looking at potentially Pay in Two products for certain types of categories of goods, such as FMCG. It's something we're exploring.
We wanna give our customers choice at the till from paying 100% upfront all the way through to paying over 36 months, giving her the choice and the dynamic access at both online and in store for our payment products.
Thanks, Sean. Chris, some questions for you on retail. How many retail stores are planned versus the previous strategy? What are the like for like sales growth in the retail business?
Cool. Maybe to answer, the first one, we're on 60 stores now, and as Paul alluded to earlier, we'll be slowing down massive investment into the retail environment. This year we will open up a maximum of five stores, and we really wanna focus on the operating margin, and returning the return on capital. We'll be settling some of those stores that we've opened. Last year, we had comp growth on our comp stores. That has slowed down in the first half of this year, over the first few weeks due to some of the credit changes that we've made.
Staying with your showrooms, two questions. What are the cash sales in the retail business? How are the showrooms performing?
Yeah. One of the reasons why we do like our showrooms, they've got about a cash contribution of about 20% of sales. Through our call center, it was only about 1%. We have seen our cash contribution in the business gone from about 5.5% three years ago to about 9%. This year, we wanted to get it over 10%. It's really a key strategy for us in terms of cash generation. We are getting that from the showrooms.
Thanks. Thanks, Chris. Sean, a question for you. Do you have any plans to expand into broader Africa?
Currently, we have a lot of headroom in the South African market. As I mentioned, our market shares are tiny at 1% and 2% across our key verticals. There's a lot keeping us busy locally, and that's where the team are focusing much of what they're doing. We do have an ear to other markets, and we will explore that when the opportunities arise. Right now, we're building our ecosystem and our platform. The model being digital is imminently portable to other territories.
Staying with tech, there's a question on AI, Sean, for you. What is the fintech business doing with AI, and what benefits are you anticipating?
Yeah. We're doing a lot. I think AI is really being used by all the departments in the business, from management through to operational areas. Our tech team especially is benefiting from sort of ChatGPT and Claude Code in terms of how they are able to code. It's improved their velocity, their quality, and their ability to test their code before taking it into the system. That's made a step change, especially Claude Code with respect to developers being able to do things a lot faster. In our support environment, inbound queries from customers are sorted and responded to or routed through to the appropriate agents.
We see this, you know, really expanding as we get agentic AI into our processes, doing a lot of the manual processing that tends to happen and then feeding more complex queries to our agents to handle. We can then do this at scale. We have 4 million customers that are soon gonna grow to 5 and 6, and having agentic AI helping you sort through the clutter is gonna be very powerful for us. Another one is intelligent call center routing. Right now, calls are received and manually routed. We're getting AI to listen to the calls, potentially answer some of the queries or route through to the right type of agent for those kinds of queries to be answered. It's a very dynamic space and a lot of opportunity for us to really leverage this.
We also of course have a huge data set that AI is really good at exploring. It's good for our marketing, our personalization, and our credit and fraud decisioning.
Thanks, Sean. I think that's all we're gonna have time for today. I wanted to thank on behalf of the management team and the business for, as I said, for your interest. We really appreciate your time. Most importantly, I'd like to thank all of our staff and employees and stakeholders in the business for the ongoing innovation and ideas and, yeah, it's great to be part of the team. Thanks on our behalf. Have a good day, everyone. Thank you.
Thank you.