Payments company Novatti confirms booming growth with another record quarter

Novatti’s quarterly update highlights the company’s strong execution on its strategy to become a global payments player.

For fintech Novatti (ASX:NOV), the March quarter saw more strong momentum as the company builds out its multi-channel payments platform.

The result was highlighted by a new record quarterly revenue figure of $4.15m. Through the first nine months of FY21, Novatti has already exceeded total annual revenues from the previous year.

Investors have responded to that growth, with Novatti shares up by more than 160 per cent since the start of February.

The stock soared higher again yesterday following a partnership announcement with BNPL giant Afterpay (ASX:APT), which will see Novatti leverage its Visa licence for APT to issue Visa card solutions in the New Zealand market.

Scaling up

Novatti’s revenue gains in the quarter were driven by its core payments processing business, which generated more than $3m in sales – up 38 per cent from the previous quarter.

The strong growth reflects Novatti’s transition “from a development to a monetisation phase”, after executing on a multi-year development plan to build out its digital banking and payments ecosystem, the company said.

CEO Peter Cook said that was evidenced by the fact Novatti is increasingly becoming the platform of choice for other fintechs to partner with.

In a busy quarter for new deals, Novatti announced a partnership with social media company LITT, which gave LITT access to NOV’s Visa Prepaid cards to integrate instore and online payments.

Innovative fintech Lifepay also leveraged Novatti’s payments technology and licences as part of its expanded go-to market launch.

Novatti holds a 25 per cent stake in the company, which now has an implied valuation of $5.125m after Lifepay announced a successful $2.5m Series A capital raise at a pre-money valuation of $20.5m.

Global ambitions

The company also announced a new partnership with Apple Pay to support its pre-paid Visa cards, and is already generating revenue from its cross-border payments deal with the global Ripple network, announced after the quarter-end.

Along with a huge quarter of new deal flow, the company is also focused on its global expansion plans, with its cloud-based business automation and payments platform, Emersion, having launched in the US market.

Already in-market across the Asia-Pacific region, the launch of Emersion into the US forms part of Novatti’s broader strategy to become a legitimate player in the global payments market, which is expected to grow to more than $300bn over the next five years.

With successful execution across all of its product channels, Novatti has now laid the framework for strong growth in a sector benefitting from a number of macro tailwinds amid the global shift to digitisation of payments.

“In the months ahead, we will continue to focus on strengthening this ecosystem to ensure we build on our growing revenue base and capture these future growth opportunities,” Cook said.

This article was developed in collaboration with Novatti, a Stockhead advertiser at the time of publishing.

This article does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.