Change Financial Limited (CCA) Earnings Call Transcript & Summary

Good morning, and welcome to the FY '25 Annual Results Update for Change Financial. My name is Tony Sheehan, CEO of Change, and I'm joined by Tom Russell, Executive Director. Similar to our usual reporting format, Tom and I will run through a presentation and then take Q&A at the end. [Operator Instructions] So what do we do at Change Financial? So we provide innovative and scalable payment solutions for over 150 clients across more than 40 countries. We are a B2B business with 2 core products. The first is Vertexon, which is our Payments as-a-Service offering, which provides card issuing, card management and transaction processing. Vertexon supports prepaid, debit and credit card issuing. And there are 2 models under Vertexon. The first is processing only. So under this model, Change provides the technology, which is the card management system to clients to run their card programs. So the clients hold the necessary scheme and regulatory licenses to issue cards. Processing only is available globally and supports all major schemes. So we have clients using Vertexon in Southeast Asia and Latin America. That includes 2 of the largest banks in the Philippines, which run over 40 million cards on the platform. The second model is processing and issuing. So this is only available in Australia and New Zealand. And under this model, clients utilize Vertexon for processing capabilities and leverage Change's regulatory and scheme licenses and issuing capabilities. So under processing and issuing, Change is the card issuer of record, and we provide treasury, fraud and compliance services to clients. Vertexon generates 78% of the group's revenue in FY '25. Our other core product is PaySim. So this is software which enables end-to-end testing of payments platforms, processes and scheme rule compliance. The PaySim software is based on the global messaging standards ISO 8583 and ISO 20022 and can be sold globally. PaySim is the default testing standard for EFTPOS in Australia, and we have a blue-chip client base, including 5 of the top 10 global digital payments companies. PaySim contributed 22% of the group's revenue in FY '25. Importantly, both Vertexon and PaySim are proprietary payments technology platforms, which are owned and developed in-house by Change. So this is important from a value and control perspective for the company. We are focused on growing both these core products given the significant market opportunity for Vertexon in Australia or New Zealand, in particular, and globally for PaySim. So during FY '25, we signed new PaaS clients in Australia and New Zealand and new projects and licenses with the existing Vertexon On-Premises and PaySim clients. So we are currently onboarding 3 PaaS clients, which will start to contribute to our PaaS metrics and volumes once they launch. In terms of some key highlights and metrics for the year, revenue was up 42% over prior year, which is materially higher than our guidance of -- in excess of 30%. We have now delivered a 3-year revenue CAGR of 22% to FY '25. 76% of revenue was derived from recurring sources. So this really provides a very solid base of revenue to grow from. So it's still very important for the business to continue to deliver one-off licenses and professional services revenue, but that base of revenue from recurring sources really gives us that solid platform. We delivered a maiden positive underlying EBITDA result of approximately $200,000. So excluding the U.S. operations, which have now ceased, underlying EBITDA was $1.3 million. So that maiden positive underlying EBITDA result is in line with the guidance that we gave to market at the start of the year. We saw a strong increase in active cards on the PaaS platform, which drove an almost sevenfold increase in transaction numbers and volume processed for the year. So we are now the largest nonbank issuer of debit cards in New Zealand. Those volume increases that's coming through on the PaaS platform is what is really driving the revenue growth in the business.

All right. Thanks, Tony. So it was another great year for Change Financial, a record revenue of AUD $15.1 million or AUD 23.3 million, which is up 42% on FY '24. As you can see in the 2 graphs by half and by quarter, the revenue has continued to increase throughout FY '25 and is continuing to increase into FY '26. We have a diversified mix of revenue across our recurring streams, PaaS and support and maintenance as well as our one-off revenue streams, licenses and professional services. I will go into this in more detail in some coming slides. You can also see the key regions globally where we have had and are having continued sales success. Over 50% of our revenue is now generated in Oceania and approximately 1/3 from Southeast Asia, while 15% comes from Latin America and the rest of the world. One of the big differences in FY '25 versus FY '24 is a portion of our revenue that is recurring, up from 58% in FY '24 to 76% in FY '25. This has primarily been driven by PaaS revenue from our Australian and New Zealand clients, increasing 391% in FY '25. Support and maintenance also continued to tick up in FY '25 on the back of license sales from FY '24 and also in FY '25. We delivered one-off revenue in our target range of between USD 3 million to USD 4 million, but we did have a slow start to FY '25 in this regard. And as we've talked about the quarterly the other week, we start FY '26 having a significantly larger pipeline of already signed professional services work to deliver and a larger pipeline of opportunities still to win. A new bit of information we have put in here is the currency which clients are invoiced. We often get asked why we report in USD. And part of the answer is because a large number of our clients around the world, even our Australian and New Zealand clients are invoiced in USD. 70% of our global client base in FY '25 paid us in USD, 20% in New Zealand dollars and 10% in Australian dollars. In terms of our cost base, the majority of our COGS are also in USD, which is very common across the payments industry. And in terms of our fixed cost base, as you would expect with the tech business, a high portion of our fixed costs are our people. We have our staff predominantly based in Australia, New Zealand and the Dominican Republic. So our fixed costs are also in those same 3 currencies, about 1/3 each. So as you can see, even without U.S. operations, functionally, there is still a bias towards U.S. dollars in the business. Most of you will be familiar with these metrics already. As we've talked about, our Vertexon PaaS business has grown significantly in FY '25, primarily from the success we've had in New Zealand. We are the biggest nonbank issuer of debit cards in New Zealand now, and we are processing over NZD 1 billion a year. To help investors better understand the different revenue streams and types of revenue in our business, I'm going to take you through the way we generate fees across Vertexon, both PaaS and on-premise as well as PaySim. This slide is solely focused on the Vertexon PaaS business. So these are our credit union clients and our fintech clients in Australia and New Zealand. Change is a B2B business only. Our clients are not the end cardholder. They are the credit unions and the fintechs, but our technology, licenses and core competencies enable our clients to effectively white label our infrastructure and to offer cards and card associated payments to their customers. The way we generate revenue from our clients is related to the activity the cardholders using change issued cards. So those types of revenues are, we charge our client setup fees and annual or monthly minimum pay platform fees. This is because if we are processing 1 transaction a month or 1 million transactions a month for the client, we have certain costs, et cetera, that need to be covered. This is a very small portion of our overall PaaS revenue. We have built the Vertexon PaaS platform to be scalable and the vast majority of our revenue is transactional based, which is why we show how our PaaS metrics are growing. Simply, from a Change perspective, we want to see clients -- we want to be signing clients, credit unions and fintechs, and then we want those clients issuing more cards, physical or digital, it doesn't matter, to their customers, and we want those cardholders transacting. So for example, if Tony is banking with Vertexon powered credit union, every time he uses his credit union Mastercard to buy groceries, petrol or go on holidays, we charge Tony's credit union a fee per transaction. Depending on the type of transaction, this is generally a fixed fee, usually cents per transaction, and we may or may not apply a variable component to the dollar amount of the transaction as well. This generally aligns with our COGS. Then if the transaction happens via a digital card, we charge fees above the base rate. There is also additional COGS on these transactions, but they generally result in a higher marginal transaction, a higher margin transaction for change. We also provide settlement, fraud and other services, and the clients can elect to sort of use these as much or as little as they want. It often comes down to their own in-house capabilities and the types of programs the customer is running. Then we also earn interchange, which has been a hot topic lately. This is only a small portion of our total revenue we earn, and it isn't paid by the client. It's paid by the merchant for the value and the benefits they get from being able to receive an electronic payment. Although you wouldn't believe it from what you hear in the media, card payments are much cheaper for businesses to accept rather than cash. So that's our PaaS revenue model, very transactional in nature. Moving now to our Vertexon On-Premise revenue model and our PaySim revenue model, which are similar in nature themselves, demonstrating the ability to scale the Vertexon platform. Our clients process and manage over 45 million credit, debit and prepaid cards using Vertexon. One of our clients in the Philippines alone has over 40 million cards running on Vertexon. For our Vertexon On-Premise clients, we have previously sold them a license, and that license revenue was earned as one-off revenue at the time. However, clients keep paying a circa 20% support and maintenance fee for as long as they continue to use Vertexon. In addition to support, we also push quarterly updates to clients to ensure their systems are up to date for the card scheme mandated changes. Without these changes, Vertexon would stop working. Our key Vertexon On-Prem clients have been with us for more than 10 years, and Vertexon is a key system for them. When clients want to roll out a new feature, take, for example, one of our Southeast Asian clients who recently rolled out a credit card offering using Vertexon. They paid new license fees for the features, and they will pay ongoing support and maintenance. Some clients also have card tiers, which means additional licenses are paid as they continue to issue cards, but revenue is generally not correlated to transaction activity. PaySim revenue works in a very similar way. New clients will pay a one-off license fee for the modules they need, then they receive ongoing quarterly scheme updates as they continue to pay an ongoing support and maintenance fee. PaySim is also very modular. Clients often take 4 or 5 core modules to start with, then our commercial team can upsell additional testing functions, which attract new license fees and additional ongoing support and maintenance. Both PaySim, but particularly Vertexon On-Prem clients also have requests to customize the product to suit their particular needs or for additional features. We charge professional service fees to clients to undertake this customization work. Okay. Turning to the profit and loss. So again, $15.1 million of revenue in FY '25, up 42% versus last year. We have been saying for the last 24 months, we have the team in place to significantly scale the business, and that can be seen from the fact that staff costs for the year increased only 4.2%. Significantly, we recorded our maiden underlying EBITDA positive result for the full year, USD 200,000. However, if you exclude the U.S. operations cost, underlying EBITDA for '25 would have been USD 1.3 million. Looking at PaaS margins, these have remained in line with H1 FY '25. Margins in '25 have been impacted by a heavy period onboarding in H1 and also bringing the digital pays, Apple and Google Pay live for PaaS clients. Change is also scaling up. We are not at scale. There are fixed yearly connectivity fees we need to pay, whether we issue 1 payment or $100 million payments. These are also regional connectivity fees. You can see the impact to the COGS line from removing U.S. COGS, roughly $400,000 for part of the year in FY '25. At the moment, we are live with scale in New Zealand, but we are also live in Australia and don't yet have significant volume to amortize these fixed costs across. With the U.S. operations now removed and the growing revenue across the rest of the business, we are starting to see significant operating leverage. Turning to the balance sheet. At the end of June, we had USD 3.9 million or AUD 6 million cash at bank and an additional USD 1 million held in cash-backed security deposits. We have started splitting out client settlement funds sitting on the balance sheet. These relate to our PaaS business. They were USD 2.8 million at 30 June and fluctuate depending on the day of the week, but will grow with our PaaS business.. There is also an offsetting liability of $2.8 million sitting in trade and other payables. We will look to split this out in the future as well to make it more clear. The other thing to call out is the increase in contract liabilities. This is already contracted and paid for support and maintenance fees as well as professional services work that will be unlocked over the next 12 months. Overall, the balance sheet is in very good shape and not a lot to talk about, which is the way we like it. As we continue to drive profitable growth, we will continue to strengthen the balance sheet. In terms of cash flow, the significant improvement has been driven by a significant increase in cash receipts, but also a stable fixed cost base. The increase in operating payments is primarily driven to PaaS COGS as volumes have increased. CapEx has also moderated as expected and capitalized software development is down almost 20% versus FY '24. We have also shown the effect of removing cash used in U.S. operations in the bottom right graph there, and you will see the business is now starting to generate material positive cash flow from our operations. Back over to you, Tony.

Thank you, Tom. Okay. So to deliver our financial results, we have a very clear and focused operational road map. So just briefly going through some of the notable operational highlights for the year. So from a commercial perspective to start with, we completed detailed market assessments for Vertexon and PaySim. So they have been used to refine our sales and marketing strategies and provided insights for our product road map. We strengthened our commercial team with the appointment of 2 new strategic sales executives. So this is really a pivot we have made towards outbound sales as a business. We've traditionally been quite an inbound sales organization. That change is now well underway with the 2 new sales executives who have joined the business to really be out there hunting to drive growth aggressively. We signed our first BIN sponsorship partners and clients in Australia and New Zealand. So these clients are currently onboarding and are expected to go live in FY '26. From a product perspective, Tom talked about this before in terms of some of the costs that are impacting on our margins at the moment from the PaaS side. We launched our digital capabilities on the Vertexon PaaS platform. Particular note here is the digital pay, so Apple and Google Pay. We have a number of our PaaS clients looking to adopt the digital capabilities over the coming 6 months, which is exciting for us, but it's also exciting for them to be able to offer to their cardholders as well. We completed a major product expansion on the latest version of Vertexon with an existing Southeast Asian On-Premises client. So the client launched their new credit card offering in Q1 FY '25, has seen strong market adoption with more than 190,000 cards issued since launch. We continued progressing the PaySim modernization project and also significantly enhanced the PaySim ISO 20022 product offering, which is key for testing account-to-account payments. From an operations perspective, we strengthened and streamlined our operational capabilities. So some of those things, enhanced settlement, automation and funds flows for our PaaS clients. We strengthened transaction monitoring on the PaaS platform as well and continued focus on platform availability and scalability. So the PaaS platform rolling 12 months availability was 99.99% plus, which is fantastic. That functionality, the PaaS platform functionality and stability was a key factor in securing the embedded finance client with existing card programs in Australia and New Zealand that we secured in Q4. We also exited the loss-making U.S. operations. So this enables the business to focus on winning in markets where there are attractive near-term opportunities. So we've seen a significant operational efficiency gains through exiting the U.S. operations in addition to the financial benefits that we've already outlined and Tom spoke around. So in terms of PaaS time lines, we have presented this slide before. So looking at our PaaS time line, you can see a steady cadence of new client wins and a significant shortening of time frames between signing clients and then launching the program. So this is driving the strong growth in PaaS revenue. So with the PaaS platform fully live and operational in New Zealand and Australia, we want to increase the number of client wins, particularly in Australia and continue to shorten the onboarding time frames. Shortening the onboarding time frames, improves the customer experience and also enables transactions and therefore, revenue to be generated earlier. So the 3 programs we are onboarding will contribute to volumes and hence, generate transaction fees once they go live. In terms of the market opportunity that we have, I mentioned on the previous slides that we undertook the market study. So there's assessments for both PaySim and Vertexon that we did throughout the year. We've used those assessments to build on our existing strategy and specifically to improve our understanding of competitive landscape, provide market analysis and segmentation to identify and focus on the most attractive customer segments for Change to target and to assist with prioritizing our product strategy to deliver long-term growth. So it's really helped in terms of shaping our product road maps for the future. In terms of the PaaS opportunity, banking in Australia and New Zealand, unsurprisingly dominated by the big 4 banks. But if we look at our position in the New Zealand market, we are processing less than 1% of New Zealand card payments. And in terms of small financial institutions, so credit unions, building societies, et cetera, and the debit card market, we are processing about 15% of that market. So we still have a lot of scope to grow in New Zealand. In the Australian market, we have not yet scratched the surface, as Tom mentioned before. We are currently onboarding clients, but our volumes are very small. So there is a significant opportunity for us to capitalize on -- in this region. We're looking to leverage our success that we've had in the New Zealand market to target the sizable Australian market. And in particular, we are looking to play in the small to medium-sized financial institutions, nonbank lenders seeking to add card functionality, nonfinancial institutions and embedded finance opportunities. So we are gaining traction in that embedded finance space where we have had some wins in FY '25. We're also looking at credit cards, not underwriting or providing the credit and also white label prepaid card brands and issuers. In terms of PaySim, so we have over 140 clients, which is less than 0.5% of the estimated global market. So where are we focusing our efforts to grow PaySim? Firstly, the partner and reseller network, so leveraging our existing partner network to drive sales and secure new partners/resellers. So it's a one-to-many approach to scale quicker. Direct sales, so outbound direct client sales supported by marketing activities. I mentioned before, we have hired a new strategic BDM that is looking after PaySim really on that outbound sales front. Cross-sell, upsell. Tom mentioned that PaySim is very modular. So it's really looking to upgrade existing clients to adopt more modules and deepen the integration to the client systems. And part of this is making sure our clients are aware of PaySim's functionality and capability is a very, very rich and hugely functional piece of software. The last one is product development. So new products and features to meet additional payments testing requirements. So part of our product road map is to enhance PaySim. We have been doing this throughout the year, and that is some of the work we have also done on our ISO 20022 testing tool for account-to-account payments. So we do have a clear product and sales strategy to drive future revenue -- future growth across both products and to continue to build on our increasing sales momentum. We appointed 2 new strategic business development managers in late Q3. The new BDMs focus on outbound sales hunting for Vertexon in Australia and PaySim globally. I mentioned before, we've historically been a sort of an inbound sales organization, but that transition is well underway to an outbound sales hunting organization to really drive that growth given we are very well positioned to scale the business. So if we look at the outlook, so we had a strong finish to FY '25, and we are seeing continued momentum in the growth of the sales pipeline. Tom mentioned it before, it is very important to note that change is in scaling mode. We are not at scale. So a key part of this will be growing the Australian PaaS client base and volumes. We expect to see continued margin improvement through incremental client wins and therefore, additional volume and transaction fees. 76% of our revenue in FY '25 was from recurring sources. So we have the solid foundations to grow the business in FY '26 and beyond through our existing the Vertexon and PaySim client base, our contracted PaaS clients that are yet to go live and the maturing sales pipeline that we will look to continue to convert. So just reiterating our FY '26 guidance, which we released to market on the 10th of July. So revenue is expected to be in the range of USD 16.5 million to USD 18 million. We are expecting a significant increase in underlying EBITDA, which is expected to be in the range of USD 2.5 million to USD 3.5 million, and we expect to be net cash flow positive. We enter FY '26 in the best position we have ever been in. We are laser-focused on delivering on our strategy and operating plan with a particular emphasis on building the sales pipeline, winning new deals across both Vertexon and PaySim and driving operational efficiencies to deliver top and bottom line growth over the coming years. Finally, to our shareholders of Change, thank you for your ongoing support of the business over the past 12 months. We look forward to keeping you updated on our progress and achievements throughout FY '26. That concludes the formal presentation from Tom and myself. We'll hand over for Q&A. I think, Tom, we look like we have received some questions in there, so I might hand that over to you.

Yes. Thanks, Tony. So as usual, we'll divide these up. First one is, can you please tell us more about the 3 new clients being onboarded as per Page 7. So you did talk more about this once this question came in, but maybe just high level, talk to who the kind of clients are?

Yes. So we sort of released these through our updates -- our quarterly updates. The first one is the personal wealth management platform that has over 0.5 million members in Australia and New Zealand. They're going live first with a debit card program in New Zealand. So that is exciting. That is a new product offering for them. Obviously, a very large client base that they will be trying to push that product out to. So that's an exciting -- very exciting client for us. The second one is a global payments company that is established -- well established in Europe. They're in the sort of wearable space. So if you think about rings and bracelets and other sorts of wearables, that's the space that they predominantly operate in. Well established in Europe, as I mentioned, they are making their foray into Australia. So they're in the onboarding process at the moment as well. And then the third one there that is in onboarding is in the embedded finance space. That was a client we won in Q4. They have existing programs in Australia and New Zealand, of which we will be rolling out. That will be a digital-only program. So Apple and Google Pay capabilities that will be leveraging on our platform. So some great programs that we're excited about to go live throughout FY '26.

Thanks, Tony. Okay. There's a couple of questions on margins, so I might roll these into sort of together and answer it. So regarding gross margin, could you please comment on the gross margin percent on PaaS separately from the non-PaaS revenue just to get a better insight on the improvement in the margin that will deliver with volume increases. And there's also another question here around margin, which sort of talked about where we see margins going in FY '26? So I'll answer that. So as we've talked about, we we've got a number of start-up COGS that we need to pay. And there's also things like card production, rolling out the digital pays that come with the sort of one-off or heavy COGS to process one transaction that you don't get on the second transaction. There's still variable costs, but you don't get the same flagfall cost. So 26%, 27% where we've come in for FY '25, it's about where we expect it to be. We have got plans to increase that into the 30s in the short term and ultimately see those margins moving towards 50% over the long term. That's for PaaS. In terms of the other part of the business, so we're a tech company. We've got 2 products the Vertexon platform, the PaaS platform and the on-premise platform is supported by the same developers and support team. It's the same platform. There might be slightly different versions out there, but fundamentally, it is the same platform. We've got the team in place to deliver professional services work between USD 2 million and USD 3 million every year. That's what we've been doing on a consistent basis over the last 4 or 5 years. So we don't report that as a gross margin. Those people we need to support the PaaS platform, support PaySim and support Vertexon On-Prem, but also to deliver that professional services work. So it sort of drops down to the EBITDA line. Okay. What is the expected revenue cadence once new PaaS clients go live sharp uplift at launch or gradual build through FY through '26? So I'll take this one as well. So the 3 clients that we've already signed, saving for any others that we might sign in FY '26, they're all start up -- well, 2 of them are start up in region. So what I mean by that is with our credit union clients, they had an existing customer base, 40,000 cards, for example, doing millions of -- hundreds of millions of dollars of volume every month. We bought those across, and we get that revenue instantly as soon as they transition that card from their existing provider to change. With the 2 clients, the personal wealth management platform and the wearables company in Australia that Tony is talking about, they are existing businesses with large customer bases, but they're launching the products in region for the first time. So we expect a sort of -- a rolling uplift in those volumes as they expand and roll out their product. The embedded finance company we won, they are already live with cards in Australia and New Zealand. So they're going to launch hopefully in the back half of -- the first half of FY '26 or early 20 -- calendar year '26, and then they'll look to move those cards across to us in the back end of FY '26. Okay. Operating leverage improved materially in FY '25 and anticipated to continue in FY '26. How do you think about trade-off between reinvesting in growth, sales and product and letting EBITDA margins expand over the medium term? So I might pass this one to you.

Yes. Thanks, Tom. So the way we sort of look at this in terms of sales or certainly the approach I take with the sales is we've hired 2 new strategic BDMs in FY '25. If we want those BDMs to build their pipelines, be hitting their targets in terms of the number that are sitting in their pipeline, the number of clients sitting in their pipeline and then converting them to actual sales revenue. If we are at the stage where there is so many opportunities there that our BDMs cannot address them, in a timely manner so that we are missing opportunities or there's -- we're just not in the flow because we don't have the capacity there, then the answer for me will be quite clear that we need to add another salesperson. And I don't think it's really going to impact on margin because the revenue will be looking after itself. So at the moment, the sales team that we have in place is sufficient. So we have a BDM in Latin America. We have 1 up in the Philippines, and then we have our BDMs throughout Australia, looking after Australia and New Zealand and pacing globally as well. We're very comfortable with where those -- with where that sales team is sitting in terms of they've got a strong pipeline. They continue to build that. I don't think we need to add more at this stage, but we will continue to assess it. It will look after itself, in my view, in terms of if we need to add further people, I'm not concerned around that sort of EBITDA margin. The other part to that question there was reinvesting in sort of product versus margin. Look, Tom mentioned before, our CapEx has reduced almost 20% versus prior year. If you look at CapEx as a percentage of revenue in our business, that has obviously come down over time. I'd like to sort of see our CapEx remain relatively steady, but get those scale benefits of reducing the proportion of revenue spent on CapEx over time, which is what we are doing there. We are comfortable in terms of where we are sitting with our capacity and CapEx at this stage as well. If there are -- again, I sort of look at it in terms of opportunity led, if there are large opportunities that require us to make further investment into our platform to secure those opportunities, we will assess that, but we're not sort of in the game certainly at this stage of building things speculatively. It will be on the back of deals there that will look after themselves.

Thanks, Tony. Okay. I'll take this next one. Have all the U.S. operations costs been finalized in FY '25? So the answer is materially yes. You'll see we've done the discontinued operations disclosure in our financials as well. There's a few admin tasks that we're still undertaking, but we won't be mentioning ex U.S. costs or anything going forward unless it's relating to a prior period now that they are materially done, and we're sort of winding up a few admin tasks over there. Tony, my first one to you. Is there any difference in commercials for change for debit cards versus credit cards?

Yes. So the real difference between debit and credit cards is the interchange fee rate. So interchange, Tom went through that in detail during the webinar. It is typically basis points on a transaction can be cents per transaction depending on what sort of merchant it hits and the interchange tables there. But typically, the commercials, the difference there is really around the interchange. Interchange is traditionally higher on credit cards than it is for debit cards. So credit card programs would have sort of higher margins due to the interchange, but depends on the arrangements that you -- that we sort of strike with our clients as well.

Okay. The first one to you as well, Tony. Could you please run through the remaining New Zealand market opportunity, which you did do after, I think this question came in a little bit? And additionally, what are the perspective client -- what are the prospective clients saying about the current regulatory environments regarding how that may change their operations?

So New Zealand has sort of been ahead of Australia in terms of the regulation. There's a lot of scrutiny around payments and surcharge in particular, very hot topic, certainly very hot topic politically as well. So New Zealand went through a consultation period around payments. That started, I think, about 18 months ago. There was a -- the [ ComCom ], the Commerce Commission in New Zealand was reviewing fees. One of those fees that they reviewed was interchange, which is what we earn as an issuer. They originally came to market and said -- proposed reducing interchange fees across all card types, so credit, prepaid, commercial cards, debit cards, et cetera. They opened that up to consultation. We participated in that consultation and made a submission. The ComCom came out with their final decision recently. They changed their initial position. Change Financial was actually cited in the paper as well. What that has done is, lowered the interchange fees on credit cards, of which we do not have any in market in New Zealand, but debit cards, of which we are a substantial player in that market now, unchanged on the interchange. So they were -- they initially proposed lowering that interchange. Their final position is debit card interchange unchanged as well. So in terms of that, there's no real impact on us or sort of clients per se. What they've also come out hot on the back of that is banning surcharges in New Zealand. Now in New Zealand, you may recall, we have the connection to the Mastercard rails, but we also have connection to the domestic EFTPOS rails as well. So the cardholders of all our clients, typically the credit unions and building societies can choose whether they want to route, use a transaction that is if you go contactless in New Zealand, that is always going to run down the Mastercard rails as opposed to if you insert your card for a chip and pin transaction, which you can route down the domestic rails. With the banning on surcharging there, I think what I would expect to see is a lot more adoption of contactless payments, which will route transactions down the Mastercard rails, which is a higher margin source of revenue for us than the Mastercard rails. There may be some merchants, if you think they call dairies, typically in New Zealand, the dairies may actually not accept contactless payments. That still won't impact on us because we've got the connectivity to the EFTPOS rails over there. So a lot of noise happening in the market over there, but it's not certainly from our clients, not changing their operations. And I think similar to Australia, the banning of surcharging that is there is a cost to do business, there is a cost of accepting cash, as Tom mentioned, that often goes unmentioned in the media, but it is very, very expensive to accept cash and move cash around. I think what we'll find is that costs will be baked into the price of goods that people are paying because there is a cost of doing those transactions.

Thanks, Tony. Last question for now, which I'll take. So the 3 new clients you have are all quite different. How does the onboarding of the 3 differ? I believe it does come down to the client, but is there any similarities or big differences? So the answer is they are all different. Where there is similarities or difference with these 3 in particular, is -- we've got 2 clients that have run card programs before, either in Australia and New Zealand or in other parts of the world. So when we bring them to onboarding and they start going through our processes to onboard and work with our onboarding team, they sort of know what to expect and they can move through it quite quickly. They also have their rollout plans may be very well defined. They roll out what they did in France. They adjust that and say, okay, in Australia, we're going to do this. And the regulation is different and all that sort of thing. But fundamentally, they know how to roll out a card program. With the other client, the personal wealth management client, they've obviously got a large customer base, but cards and working with us and Mastercard in the payment space is new for them. So things can take a little bit longer, not because of anything other than you just got to work your way through the process. And we have another question. Do you intend to compete with existing players on price or functionality? Wondering your positioning as the low-cost provider. Tony, I'll let you answer that one.

I'll take that, Tom. So in this -- in the competitive space that we're in, in terms of issuing, there are -- all players are going to be within a certain band of where pricing is going to be. Some are going to be slightly higher, some are going to be slightly lower. But you're all sort of operating within a reasonable band of pricing here. Where we position ourselves and where we are winning is on the functionality of the technology of the platform. So we're taking institutional-grade technology that is running 40 million-plus cards at large financial institutions globally, we're bringing that to the smaller end of town, whether that's credit unions or building societies or fintech. So it's the functionality. I talked around that stability of our platform as well, 99.99% plus. That is a fantastic stability rate for our platform as well. That is very key. So it's the product offering. But again, for us, another part of -- a big point of differentiation and something that we win on is around our service. So we really do work with our clients very, very closely in terms of service and responsiveness to our clients to win. It's not a race to the bottom in terms of pricing here. It is around product and service, but you're working within the sort of the bounds of sort of pricing bands. Are we going to be priced well out of market compared to others and still win deals? Unlikely, but we're not going to be priced lower well out of the bounds as well to win deals. We'll be priced with our competitors there, but it's our product and our service that we -- that differentiates us.

Okay. Thanks Tony. We've got a few more questions coming in. I'm going to throw this next one to you as well. Can you talk to the strength of having Vertexon developed internally versus someone who might outsource to a third party? You've talked about that a little bit, but...

Yes. So I think I've mentioned at the start, owning our technology, it's a real value that Change Financial has is that we own the technology for both Vertexon and PaySim. So in terms of having the strength there, because it is our platform, we have the team that works on it, we can respond to client needs or market needs in terms of the technology very quickly. We're not having to rely on a third-party card management system provider to be able to do changes to fit what our clients need or what the market needs. So it's really that responsiveness and agility is a key differentiator. There is also the sort of cost element of that. So having external card management systems as well can be quite costly when you're trying to factor that into the pricing of deals as well. So change is not the only player that does this, but it is quite -- we're in quite a unique position that we do own our own technology. So we do have that sort of control over our own destiny there.

Okay. And last one, how does Cuscal recent acquisition of Change the market structure?

Yes. So I don't think it changes the market structure, particularly there. I think with Cuscal in terms of that acquisition makes a lot of sense, similar industries, similar histories as well. I think there's probably some complementary offerings there that [ Inju ] will bring to Cuscal. I think there's a lot of integration work that will need to be done over the next few years, as you can see from Cusal's estimates of the integration costs. But I don't think it will change materially. I think they both operate in quite a similar space. So I think we'll still continue to come up against Cuscal as we do on some of our opportunities that are there. But I don't see huge market structural shifts around the merger of those 2 similar businesses.

All right. That's all questions.

Okay. Well, thank you all for your questions. As always, we do appreciate the interaction and the interest that you take in our business. So thanks again for dialing in today, and thanks again for your support throughout FY '25.