Annual Report and Financial Statements | Page 29
Directors’ Report (continued)
• Enterprise business, whereby RS2 manages the client’s private infrastructure on the cloud, in
addition to providing processing and other services;
• Acquiring processing, which focuses on Payment Facilitators (PayFacs), Payment Service Providers
(PSPs) and follow up on the existing ISO pipeline;
• Issuing processing (a new business line).
RS2 Smart Processing continues to increase its transaction processing volumes through new and
existing customers. It is also working on standardising its product and service offering to improve time-
to-market and profitability, thus enabling the Group to also offer services to smaller clients. This
subsidiary company is developing a fully digitalised service enabling a client to self-onboard and choose
the services required for its business and market needs. The company has executed letters of intent
with clients in Europe, Asia Pacific and Latin America, for which implementation has already started,
while also negotiating several processing agreements.
In Asia Pacific (APAC), the Group developed InstaPay, the real-time online local scheme, which will allow
the offering of services to banks in the market using our own developed mobile application for fund
transfers, bill payments and other banking services.
The Group’s investment in human resources provides the necessary support to successfully launch the
new acquiring business and obtain the EMI Licence, through BaFin. This enabled RS2 to provide a wide
range of payment acceptance and other financial services to merchants and consumers across Europe
and to process cross-border merchant payments globally. The new acquiring business will reinforce the
shift in the revenue model for RS2 Group, from dependence on one-time licence fees to ongoing and
recurring revenue based on the number and value of transactions processed. The launch of the Group’s
Financial Services sector, following the acquisition of its EMI licence, was concluded successfully in the
second quarter of 2022. In addition to this, the German subsidiary became a principle member of Visa
and MasterCard. As an EMI institution and principle member, the Group is now able to provide direct
acquiring and issuing services to merchants, which were set in motion in 2022.
During the year under review, the Company registered revenues from its principal activities of €18.2m
(2022: €19.7m) and a profit before tax of €2.3m (2022: €1.8m). The Managed Services arm of the Group,
RS2 Smart Processing Limited which is principally engaged in the processing of payment transactions
with the use of BankWORKS®, recorded revenues of €13.6m (2022: €11.7m) and a profit before tax of
€1.2m (2022: €4m) while RS2 Software INC., which serves as the US arm of the Group with specific
focus on the provision of Managed Services in North America, recorded revenues of €17.2m (2022:
€14.7m) and a profit before tax of €2.0m (2022: loss before tax of €0.1m). RS2 Software APAC Inc. is
currently supporting the Company in product development and its expansion in the APAC region. The
RS2 German subsidiaries focus mainly on direct merchant acquiring and issuing services using one
platform that integrates through API to the merchant’s website or store, thereby consolidating the entire
business of the merchant across all the respective payment channels.
During the year under review, upon consolidating all of its activities, the Group generated revenues of
€39.7m (2022: €37.5m) and registered a profit before tax of €1.4m (2022: €1.8m). At 31 December 2023,
the Group’s total assets amounted to €49.4m (2022: €43.4m), whereas its current assets exceeded its
current liabilities by €0.04m (2022: €3.6m).