UMT (DE:UMD) is at an exciting time in its development. Germany’s largest loyalty scheme, Payback, has announced it will launch its UMT-powered mPay service in June. This should give rise to new platform maintenance and commission streams, and potentially new data analytics earnings arising from data crossing UMT’s platform. Helped by the reputational boost from the Payback launch and a promising new client pipeline, we see good prospects for UMT to bring a number of new customers on board in 2016-17 and generate significant earnings growth over the next two to three years.
UMT set to take German lead in mPay
As a result of the current contract with Payback, UMT will embed its mobile payments (mPay) technology in the tills of 45% of Germany’s retail sector and power the mobile payments of the largest loyalty programme in Germany, with 28 million members. UMT is also Payback’s preferred partner for the roll-out of mPay to its loyalty programmes in Italy, Poland, Mexico, India and the US, where the rest of Payback’s 75 million members are located. Payback’s plans to intensively advertise and promote the app and mPay, and the existing tally of 8.5m downloaded apps, should boost early adoption of mPay. This has led us to forecast that 2.6 million of Payback’s German customers will already be using mPay by the end of this year.
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