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For Immediate Release

2 November 2020

Zaim Credit Systems Plc

("Zaim" or the "Group")

Significant Growth of Online Business

Zaim Credit Systems plc, the Russian focused fintech group providing financial inclusion for consumers who are not well served by mainstream lenders, is pleased to provide an update on the progress of the online business for its wholly owned subsidiary, Zaim-Express LLC, ('Zaim-Express').

Highlights:

·    Online operation now represents largest portion of the Group's business and is continuing to grow

·    The shift to a more flexible and scalable online operations represents the successful delivery and execution of the revised strategy, resulting in significant growth from a low online base at the time of our IPO last year

·    Covid-19 has accelerated migration of the business model from offline to online having a positive impact on the business growth and margins due to its comparatively low fixed cost base

·    Zaim-Express' business is in significantly stronger position as a result of online migration

·    Launch of Mobile App, which is expected to increase repeat customers and grow target market penetration, scheduled for 1H 2021

·    Continued enhancements to credit scoring process anticipated to continue to improve default rates

Siro Cicconi, Zaim's CEO commented:

"During the last several months and accelerated by the recent pandemic related movement restrictions, Zaim has cemented its evolution from a traditional physical store-based model to a highly-flexible and scalable online-focused business.

We are pleased to report that our efforts are already showing positive results beyond our expectations with the online platform representing the most significant part of our business for the first time in the Group's history.

This has all been generated from a near standing start for our online business in Q4 2019 at the time of the IPO. This transformation lays the foundation for further growth and shareholder value through scalability and increased margins and we look forward to updating the market regularly as to our progress."

Background to Online Business

In recent years, Zaim has made substantial investment in the development of a convenient online platform, allowing customers to receive and repay loans via the internet or by phone in several minutes without leaving their homes.

As a direct result of the continued strategy of the optimisation of the business model, we have significantly reduced the number of physical stores from 92 to 32 and redirected customers towards our online product offering where we have accelerated online business development and focused resources that would have otherwise been deployed in the physical stores.

Online Lending - Website and Marketing Update

In recent months we have improved our consumer facing web-site design resulting in significantly increased website visitor - to - new application conversion rates (from 30% to 60%) and reinitiated cost-per-action traffic to increase the flow of new clients. We have also launched targeted advertisements, testing different channels to attract new clients, performed competitive analysis from a marketing standpoint and improved call center scripts that further increased our customers' conversion.

As a result of these actions, the business is experiencing strong growth in its online lending activity.

Zaim-Express management is currently working on a number of further developments of the online platform including improvements of the scoring system that should decrease overall default rate numbers for new clients, updating collection strategy that is expected to enable faster return of funds and improving application functionality to increase new sites visit to new client conversion rates. We are also enhancing search engine optimisation allowing us to increase the flow of visitors from Google and Yandex search platforms as well as to improve the overall company's image.

Launch of smart phone Application ("App")

Given the success of the online offering for Zaim's products and the rapid growth in demand that we are witnessing, a new App is in the process of being developed which should further the user experience and increase the potential target market for Zaim. 

Zaim is currently defining the development pathway and it is currently expected to proceed to full scale launch in 1H 2021. This is expected to increase the number of repeat customers which is a key metric to ensure consistency of the default rate.

These developments make us confident that during 2021 we will further accelerate the growth of the online business as the online platform as the App is fully completed.

Enquiries:

The information contained within this announcement is deemed by the Company to constitute inside information as stipulated under the Market Abuse Regulations (EU) No. 596/2014 ("MAR").