Home Money CAB Payments to cut 20% of staff as fintech relies on AI

CAB Payments to cut 20% of staff as fintech relies on AI

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Layoffs: CAB CEO Neeraj Kapur (pictured) said the company
  • CAB Payments is understood to be making 80 staff redundant, mainly in the UK
  • The firm intends to undertake this restructuring during the first quarter

CAB Payments has revealed plans to reduce its workforce by a fifth and invest in artificial intelligence to keep costs down.

The fintech group’s shares have lost around 80 percent of their value since listing on the London Stock Exchange in July 2023, amid profit warnings and the departure of its chief executive.

CAB told shareholders on Thursday it expects savings from job cuts to offset the “annualisation of strategic hires” made last year, as well as inflation and national insurance rates.

From April, employers will pay NI contributions of 15 per cent on staff salaries over £5,000, up from the current rate of 13.8 per cent on salaries over £9,100.

Many British businesses have responded to the incoming tax rise by taking pre-emptive measures to cut staff or scale back hiring plans.

It is understood that CAB will make 80 staff redundant, with the majority of those affected based in the UK, while investing in automation and artificial intelligence.

The Southwark-based firm intends to undertake this restructuring during the first quarter of 2025.

Layoffs: CAB chief executive Neeraj Kapur (pictured) said the company will “see a number of colleagues who have been part of our journey depart our group”.

Neeraj Kapur, CEO, CAB, said: ‘As part of an increased focus on performance, we are taking important steps to realign the cost base with our strategic growth plans; which means we can do more with less.

“As a result, we will see several colleagues who have been part of our journey leave our group.”

CAB, the holding company of Crown Agents Bank, specializes in offering payments and foreign exchange services.

Its total trading volumes increased by £3.4 billion to £37.6 billion last year, with all the growth driven by developed markets.

However, the London-listed company saw demand for cross-border payments impacted by a stronger dollar, lower aid flows and political uncertainty.

Its acceptance rate – the percentage it charges as a fee for a transaction – almost halved, from 0.26 percent to 0.14 percent, due to lower demand for US dollars in certain markets and a decline in market volatility in emerging currencies.

As a result, the group expects to report gross revenue of around £105 million by 2024, compared to £137 million the previous year.

Kapur added: ‘CAB’s fundamental business model remains strong, based on strong emerging market connectivity; Our market share is increasing and we are seen as experts in what we do.

“We are now focused on driving growth in volumes, but more importantly in acquisition rates and operating leverage, which is where our banking business becomes a key driver.”

US payments company Stone

StoneX reportedly made multiple bids, including one valuing CAB at £368.5 million, before pulling out in November.

CAB Payments Holdings Stock They were down 2 per cent at 65.25 pence, taking their losses over the past six months to about 43 per cent.

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