New Zealand-based payments company Smartpay plans to go direct in Australia with a new business called "Smartpay Taxis" after its relationship with an Australian taxi payments provider expires at the end of the year.
That relationship was generating 8 percent of the company's revenue.
Smartpay sees an opportunity emerging in structural changes in the Australian taxi market, which were created by booking apps that have disrupted the industry through disintermediation, and in regulatory changes to cut surcharges on card payments.
Through Smartpay Taxis, the company will participate directly in the taxi payments industry rather than through supplying terminals and services wholesale to a single customer.
Smartpay told shareholders at its annual general meeting yesterday that the new business would take time to develop, but would ultimately deliver higher margins.
The company said it has developed a market-leading taxi payment technology, which integrates a mobile booking app with mobile wallet payment capabilities and a physical in-car payments terminal, taxi meter, and dispatch network.
Smartpay reported a record full-year profit for the year ended June 30, 2014, with earnings before interest, tax, depreciation, and amortisation (EBITDA) up 76 percent to $9.7 million, and net profit of $1.7 million, up from a $5 million loss in 2013.
Revenue was $22.9 million, up 37 percent on the previous period of $16.7 million.
Traditional payment providers, such as banks, are challenged to facilitate the next level of innovation, the company said. Smartpay is seeing growth opportunities through increasing engagement with banks, distribution partners, and merchants seeking its new products and technology capabilities.
Smartpay has also launched a developer program and software development kits to allow mobile developers to embed its payments capabilities into their apps.
The company already provides mobile point of sale systems to New Zealand bank ASB, a subsidiary of Australia's Commonwealth Bank.
Along with its mobile payments products, Smartpay has developed a Till2Go app and integrated its next-generation mobile payments terminals with both smartphones and tablets.