With most staff working from home, the headquarters of Kazakhstan’s fintech hero Kaspi.kz exudes a sleepiness ill-fitting a company whose rapid rise has been accelerated by the coronavirus pandemic.
Kaspi, Kazakhstan’s payment systems and e-commerce leader, became the Central Asian country’s most valuable firm after it was valued at $6.5 billion on the London stock exchange in October in what was the United Kingdom’s second largest float of this year.
The listing took commentators by surprise, coming after a failed attempt – falling short of a $4 billon market cap valuation – the year before.
But Kaspi’s Georgia-born CEO Mikheil Lomtadze, said that the company and its investors, including Goldman Sachs and CIS-focused Baring Vostok – were not fazed by the false start.
“We believe that we have a lot of space for further growth, and we were not in any hurry to do our IPO,” said Lomtadze in the company’s head offices in Almaty.
Lomtadze, sporting an open-necked shirt and jeans, said that beyond China, where online payment systems Alipay and WeChat have become ubiquitous, there are few markets that have seen user behaviour so utterly transformed by mobile payments as Kazakhstan.
“We are frontrunners in digitising the country,” Lomtadze said.
The coronavirus is a stern test of Central Asia’s largest economy, with Kazakhstan’s gross domestic product expected to shrink year-on-year for the first time in over two decades.
Kaspi, which began life as a bank in the ex-Soviet country before expanding into peer-to-peer payments and online marketplaces, is bucking the trend.
Active monthly users of its app that offers an array of services rose 70% in the first six months of 2020 compared with the same period last year, reaching nearly 8 million in a country of around 19 million people.
Kaspi’s online marketplace services and army of couriers – exempted from restrictions on movements during a lockdown in March and April – proved vital for businesses.
The app meanwhile delivered more than 60% of all government coronavirus relief payments to eligible citizens.
“During these difficult times… we became even more relevant,” Lomtadze said.
Investor interest in Kaspi, limited to funds by the terms of the IPO, points to confidence in a future beyond Kazakhstan for the company.
Kaspi has aready entered Azerbaijan, another ex-Soviet state, where it owns the leading online marketplaces for cars, used goods and real estate.
There, Lomtadze said, it is pursuing its Kazakh business strategy in reverse – beginning with retail ahead of planned moves into peer-to-peer and banking.
Kazakhstan’s neighbor Uzbekistan, Central Asia’s most populous country with 34 million people, represents another target, he said.
Few would have predicted Kaspi’s trajectory back in 2014 when a sudden devaluation of the tenge currency weakened confidence in Kazakhstan’s financial sector.
There were rumors at the time that prominent banks, including Kaspi, were set to default.
In a bid to reassure depositors, Lomtadze and Vyacheslav Kim, a Harvard MBA classmate and Kaspi’s chairman, toured Kaspi branches, financial analyst Tulegen Askarov recalled.
“When the owners of a bank talk to ordinary depositors like that, they probably develop a better understanding of what their business should look like,” Askarov said.
He also noted the influence of next door China, where Kazakh businessmen became acquainted with Alipay and WeChat, in accelerating Kaspi’s long-planned shift towards fintech.
Kaspi’s central role in everyday life was highlighted by a technical hiccup two weeks after the London IPO, which sent services offline and saw users pile onto social media to post light-hearted memes depicting a return to the stone age.
The glitch was corrected within hours, a process Lomtadze likened to “fixing an engine while the plane is flying”. Users grew the next day and clients were rewarded for their loyalty with bonuses.
In central Almaty even street buskers flag their Kaspi number as an alternative to cash payments, and taxi drivers use the app to give change to customers.
A 21-year-old student named Jibek told AFP that even one morning without the app that she downloaded only just over a year ago was a jarring experience.
She values it for its bill paying functions and cash-back features, describing it as “very convenient”.
“All of Kazakhstan is hooked on it,” Jibek said.