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rs2.com
Annual Report & Financial Statements
2022
Annual Report and Financial Statements | Page 2
Table of Contents
Annual Report
Who We Are ..................................................................................................................................................................... 05
Chairman’s Statement ...................................................................................................................................................... 09
CEO’s Statement ............................................................................................................................................................... 11
Board of Directors ............................................................................................................................................................. 16
Corporate Social Responsibility ........................................................................................................................................ 20
Directors’ Report .............................................................................................................................................................. 25
Corporate Governance Statement of Compliance ........................................................................................................... 38
Remuneration Report ....................................................................................................................................................... 48
Statement of the Directors pursuant to Capital Market Rule 5.68 ................................................................................... 52
Company Information ....................................................................................................................................................... 53
Directors’ Responsibility for the Financial Statements ..................................................................................................... 54
Financial Statements
Statements of Financial Position ...................................................................................................................................... 56
Statements of Profit or Loss ............................................................................................................................................. 58
Statements of Comprehensive Income ............................................................................................................................ 59
Statements of Changes in Equity ...................................................................................................................................... 60
Statements of Cash Flows ................................................................................................................................................. 64
Notes to the Financial Statements ................................................................................................................................... 66
Independent Auditors’ Report ........................................................................................................................................ 188
Annual Report and Financial Statements | Page 3
Annual Report
Annual Report and Financial Statements | Page 5
Who We Are
A global technology leader
shaping the future of payments
RS2 Group is one of the world’s leading providers of omni/multichannel payment software and end-
to-end payment solutions for both issuers and acquirers on a single payment platform.
The Group has over a 30-year history of designing and operating payment technologies and solutions
for a wide range of customers across various industries such as banking, e-commerce, and retail.
With seven offices spread across the globe, the Group provides innovative, sustainable, secure
payment solutions and services along the entire payment value chain and is the technology partner
of choice for banks, large financial institutions, Integrated Software Vendors (ISVs), Payment
Facilitators (PayFacs), Independent Sales Organisations (ISOs) and merchants throughout Europe,
North America, Latin America (LATAM), Asia Pacific (APAC) and the Middle East.
The Group’s cutting-edge payment solutions are used by more than 250 customers in 35 countries,
allowing its customers to provide services to more than 16 million merchants and over 350 million
cards around the globe through the various business lines of the Group. Among these customers are
5 of the top 20 multinational and local acquirers.
Following the approval and issuance of an Electronic Money Institution (EMI) license by the German
regulator, the German Federal Financial Supervisory Authority (BaFin), for the Group’s subsidiary RS2
Financial Services GmbH, the Group is now continuing its exciting journey towards becoming a
leading, full service, global payments player.
One single platform
enabling global commerce
The Group’s BankWORKS® platform is built on a state-of-the-art Application Programming Interface
(API)-based micro services technology, providing end-to-end payment, such as payment gateway,
switching of payment transactions originated from Point-of-Sale (POS), ATM, e-Commerce, InAPP,
clearing and settlement, chargeback management integrated in the merchant portal, fraud and risk
monitoring, reporting and statement, and a sub-GL accounting and automated reconciliation that fully
integrates with the client’s general ledger.
Annual Report and Financial Statements | Page 6
Who We Are (continued)
The uniqueness of the solution, being one single global platform deployed on the cloud, provides the
customer, through one single API sandbox integration, the ability to transact globally, integrating with
local acquirers and issuers, to increase their conversion rate, reduce their interchange and other
related fees and charges, and provide them with quick access to the market. The Group is well-
positioned to service multinational customers and process their international and local payments,
providing them with one single view, consolidated reporting, and reconciliation of their entire business
in multi-languages, multi-currencies including crypto, and other digital currencies in multiple time
zones.
Business Lines
- covering the entire payment value chain
The Group provides a fully integrated, digital Omni-/multichannel payment solutions as well as value-
added services across the entire payments value chain through three global business lines.
Processing Solutions
- Processing of payment transactions utilising BankWORKS® software
A full-feature end-to-end processing solution for issuing and acquiring through a single integration to
RS2’s unique BankWORKS® cloud platform. Customers can manage their entire payment services
such as authorisation, on boarding, payment gateway, security and fraud, chargebacks, reconciliation,
and settlement as well as optimise their interchange.
 Processing of payment transactions utilising BankWORKS® software;
ï‚· Platform as a service (PAAS) on a private/public cloud solution for acquiring, issuing, clearing
and settlement covering multiple Omni channels;
ï‚· Provision of installation services (setup); and
ï‚· Other services including statements, chargebacks, merchant portal and e-commerce
gateway.
Annual Report and Financial Statements | Page 7
Who We Are (continued)
Software Solutions
- Licensing of BankWORKS® software to banks and financial institutions
RS2’s modular, highly scalable, and flexible software solutions are developed in-house and cover all
areas of payment, including card issuance, merchant acquiring, clearing and settlement, online
switching and authorisation, PIN management, customer services, e-commerce, and dispute and
fraud management, allowing its customers to rapidly and cost-effectively set up their system by
configuring only those products and modules required for business.
The Group provide flexible collaboration models to suit customers’ business needs:
ï‚· Term or perpetual licenses for banks and financial institutions to utilise its BankWORKS
®
issuing and acquiring platform;
ï‚· Installation, depending on size and scope of installation;
ï‚· Customisation, implementation, and installation services;
ï‚· Upgrades, enhancements, customisation and on-going support for its BankWORKS
®
platform,
as well as updates mandated by international card organisations;
ï‚· Additional services, including but not limited to, onsite support for testing, implementation and
training, beyond the originally defined scope of the initial implementation; and
ï‚· Value Added Services.
Merchant Solutions
- Offering issuing and acquiring payment solutions directly to merchants
The Group’s subsidiary RS2 Financial Services GmbH holds an EMI-Licence from the German
regulator, BaFin, enabling the Group to provide a wide array of services using one single platform that
integrates through a strong wide range of APIs to the merchant’s online businesses and physical
shops, consolidating the entire business of the merchant across all the Omni-/ multichannel payments
offering them one-stop-shop services including but not limited to:
ï‚· E-Commerce
ï‚· Card not present (incl.
Payment Service Provider
(PSP) Services
ï‚· Card present (incl. POS
Terminals & Network
Services)
ï‚· InAPP-Payments
ï‚· Payment Gateway
ï‚· Chargeback Management
ï‚· Call Centre Services
ï‚· Issuing of Prepaid Cards
ï‚· Fraud and Risk Monitoring
Services
ï‚· Reporting and Reconciliation
ï‚· Interchange Optimisation
ï‚· Smart Routing increasing the
approval rate
ï‚· Dynamic Currency Conversion
ï‚· Instalments
ï‚· Recurring Payments
Annual Report and Financial Statements | Page 8
The Group has
however strived to
achieve important
milestones across
all business lines
ensuring it is on
track with its
strategic roadmap.
Mario Schembri
Chairman
Annual Report & Financial Statements | Page 9
Chairman’s Statement
2022 has been a challenging year – the economic outlook has been uncertain given the recent
disruptions brought about by the COVID-19 pandemic, followed by the war in Ukraine and presently,
the rising of inflation and interest rates. The Group has however strived to achieve important
milestones across all business lines ensuring it is on track with its strategic roadmap.
During 2022, the Group continued to execute its strategy of expanding its client base and increase
its product offering in different markets throughout Europe, Middle East, North America, Latin
America, and Asia Pacific.
In the Merchant Solutions business, after obtaining an Electronic Money Institution (EMI) license from
the German regulator, BaFin, in 2021, the Group reached its next important milestone of launching its
acquiring business through RS2 Financial Services GmbH. The company obtained its principal
membership from both VISA and MasterCard and passported its licence to Austria.
The EMI license enables the Group to manage merchant funding, provide acquiring services and to
issue payment instruments. It is also part of the Group’s strategy to shift its revenue model from
dependencies on one-time licence fees towards ongoing and recurring revenue streams based on
transaction volumes processed.
Under its Processing Solutions business, the Group has exceeded the one billion mark of technical
transactions processed – over the past twelve months more than 1.25 billion technical transactions
were processed on the BankWORKS
®
platform. This trend is expected to continue to increase through
further processing of transactions of the Group’s existing and new clients. In fact, the Group has won
several new major outsourcing clients in Singapore, Malaysia, Mexico, Chile and Peru.
On the Software Solutions business side, the Group has an outsourced processing agreement with
one of the largest banks in the United States, on a hybrid licensing and processing model, to deliver
Global Acquiring and Issuing Services, further endorsing the power of our platform. In the US, the
Group will continue to offer acquiring processing to Payment Facilitators (PayFacs), Payment Service
Providers (PSPs) and Independent Sales Organisation (ISOs) and to attract tier one financial
institutions and banks of all sizes that are increasingly opting for outsourcing models for their
payments processing operations, in order to lower costs, reduce complexity and minimise risks. The
Group’s US arm will also be introducing a new business line of servicing Issuer Processing.
I would like to take this opportunity to thank our team members across the world for their commitment
and dedication, our Chief Executive Officer (CEO) who has worked tirelessly to execute the Group’s
strategy and our Board of Directors for their support throughout the year.
I would also like to thank our shareholders, clients and partners for their continued trust and support.
We look forward to continuing this journey together – beyond payments.
Mario Schembri
Chairman
28 April 2023