Eleving Group scales back operations in countries affected by the war in Ukraine
Riga, Latvia, 04 March 2022. Eleving Group, a Latvian head-quartered leading provider of financial solutions in Central Europe, CIS & East Africa, is following the situation in Ukraine very closely and greatly regrets the current development. The Company's top priority is to ensure the safety of its employees. So far, only the business activities in Ukraine are directly affected, while further development in Belarus is being closely evaluated.
With less than 3% of the total portfolio, Eleving Group has a limited presence in Ukraine. Already in the prewar period, the Company had significantly curtailed new issuances and stopped them completely as of 24 February 2022. Currently, Eleving refrains from strict collection measures and offers all its customers to defer payments without additional fees or interest being calculated. Collections from the portfolio declined significantly, although significant payments are still being made by customers daily. Given the digital-only business in Ukraine, the scale back of the local portfolio is not exposed to any material risks. The Company is not planning any new issues for the foreseeable future and will focus on collection activities while maintaining a lean cost structure. Eleving Group is focused on supporting its employees and their family members in Ukraine.
The scope and impact of possible sanctions against Belarus as a result of its engagement alongside the Russian Federation cannot yet be assessed. Although the business activity in Belarus historically shows the greatest resilience of the operating countries against crises of various kinds, Eleving Group has decided to stop issuances in Belarus and focus on reducing the existing exposure. The Company is optimizing its costs structure in Belarus and is putting full focus on collection activities and incentivizing customers to repay their outstanding loans early. At this point, collections are unaffected, and the Company is receiving a significant amount of positive cashflows, with a focus on developing several secure ways to transfer foreign currency out of Belarus. Excess cash is being repatriated to EU countries.
Eleving Group itself is not a sanctions target and does not maintain business relations with Russian banks. The proactively initiated contingency management to ensure business continuity includes, in particular, real-time assessment of the situation in the affected countries of operation, liquidity management, and securing foreign exchange transfers across the borders of sanctioned countries.
To support the people of Ukraine, Eleving Group has joined the “Entrepreneurs for Peace” movement and donated EUR 100,000. In cooperation with the Latvian Ministry of Defense, the Ukrainian Embassy, non-governmental organizations (NGOs) and organizations providing international humanitarian aid, the charity platform Ziedot.lv and others, the comprehensive and coordinated support network aims to provide the most targeted assistance possible to the war-affected people in Ukraine, in line with the current needs of Ukraine and its population.
Modestas Sudnius, Group CEO of Eleving Group commented:
“The situation in Ukraine deeply saddens us and our hearts at Eleving Group are with all those affected. Wars only know victims, on all sides. To protect the workforce and the Company, we have decided to scale back activities in Ukraine and Belarus – in line with our crisis plans – in an orderly and controlled manner. As a result of our preparations over the past weeks and months, the corresponding measures are proceeding according to plan. On behalf of the entire Management Board and all employees at Eleving Group, I would like to thank all the teams on the ground for their hard work and commitment during this difficult and special time. We sincerely hope for an early, peaceful end to the conflict and thus a quick return to a normalized situation.”
About Eleving Group
Eleving Group comprises a number of international and fast-growing financial technology companies with a global presence. The Group operates in the vehicle and consumer finance segments in 3 continents, providing financial inclusion and disruptively changing financial services industries in its countries of operation. Founded in 2012 in Latvia, the Group has revolutionized the way people purchase cars. Having expanded all across the Baltics within its first year in business, the Group continued expansion in the following years, servicing a total of 14 active markets.
With its headquarters in Latvia, the Group operates in the Baltics, Central, Eastern, and South-Eastern Europe, Caucasus, Central Asia, and Eastern Africa.
For two consecutive years since 2020, the Group has appeared on the Financial Times list of Europe's 1000 fastest growing companies.
Further information:
Maris Kreics
Group Chief Financial Officer
maris.kreics@eleving.com
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