Freedom Finance Bank releases super-app

Kazakhstan’s Freedom Bank, a key asset in the Freedom Holding Corp. enterprise, has released its super-app.

The “Freedom SuperApp” offers Bank clients access to a diversified suite of financial and other service offerings exclusively available in the company’s ecosystem of products.

Freedom Bank is now among the top 8 banks, in terms of assets, in the country and serves about 1 million customers.

Increase in loan portfolio and rating affirmation

In March 2024, S&P Global Ratings affirmed the rating for Bank Freedom Finance Kazakhstan (along with other subsidiaries of Freedom Holding Corp.) at “В/В,” highlighting positive trends in the financial sector of Kazakhstan. This is the highest rating for a company in Central Asia.

S&P Global Rating said in a statement:

We believe Kazakhstan’s financial services sector’s resilience to macroeconomic and geopolitical risks in the region has improved, and we observe a gradual enhancement of financial oversight of domestic financial institutions.

S&P also highlighted the rapid increase in lending by Freedom Finance Kazakhstan.

Freedom Finance group posted a net income of $280 million and a return on assets of 6.0% for the nine months ended December 31, 2023, on the back of higher net interest income from increased lending and income on securities.

Freedom Bank has been showing a significant increase in assets as of late (more than $4.4 billion) and has already become one of the key participants in the financial sector of Kazakhstan.

Growth in customers

Under the business development plan of Freedom Holding Corp., the number of the Bank’s customers is expected to increase significantly by 2025 and further in 2026.

According to top executives of the parent company, the lion’s share of its revenue is currently allocated for expanding its banking business by increasing the Bank’s capitalization to boost its overall liquidity and lending.

Timur Turlov, CEO of Freedom Holding Corp, said:

We see vast underinvestment and substantial potential in Kazakhstan and we believe that we could have grown even faster if we had more liquidity. There is a large demand for lending and business loans.

Freedom Holding Corp. is going to scale up the Bank’s business by offering both financial and non-financial products through close integration of its subsidiary companies, allowing clients to seamlessly switch from one business line to another, in a one-stop-shop fashion.

This could apply not just to Freedom’s brokerage and its bank, but also to its telecom operator and lifestyle companies within the Freedom enterprise (online selling of tickets for events, booking flights and foodtech).

Innovation and security in banking

Almost all products of the Bank can be described as digitally innovative as they are available online, and do not require and in-person visit or documentation verification.

For instance, Freedom Bank is the only bank in Kazakhstan that can conduct an online evaluation of real estate, or a car, which is very convenient for both the client and the Bank.

The issuing of a loan takes just 24 hours on average, and in some cases, a mortgage loan can be issued within 3 hours, a car loan in 2 hours, and a business loan in 30 minutes.

These are real records set by the Bank.

Key digital milestones for Freedom Bank:

• In 2021, the Bank introduced a digital system capable of issuing mortgages and became the first bank in Kazakhstan that offered digital mortgages;
• In early 2022, the Bank’s digital mortgage program became a part of a state housing initiative called “7-20-25.” By the end of that year, the Bank’s market share reached 63% as it issued the most mortgages in the country;
• In 2022, Freedom Bank also launched its digital car loan program, its second online financial product;
• In 2023, the Bank expanded its digital platform by introducing online loans for small and medium-sized businesses.

The Bank pays a lot of attention to security which is governed in large part by compliance.

For the Bank, and for the brokerage, compliance is a series of highly structured processes and procedures aimed at helping implement Kazakhstani legislation and guarding against money laundering and the financing of terrorism. It is multilayer work, assessing risks, and also involving constant communication with regulators.

As part of its process, the Bank checks if its potential customers are on sanction lists and if their income is legal. Secondly, it monitors client’s transactions to guarantee that they are not intended to breach sanctions and aren’t linked with money laundering. It’s an intensive program.

Freedom Broker: Growing number of client accounts

Freedom Finance JSC and Bank Freedom Finance Kazakhstan have been rated by S&P at “kzBB+” on the Kazakh national scale ratings.

The rating agency believes that Kazakhstan’s GDP will grow by 3.6% on average within the next few years and that this positive environment could facilitate the expansion of Freedom Holding Corp.’s business prospects.

The brokerage business line of Freedom Holding Corp. is also rapidly growing.

In Kazakhstan, this business line is represented by Freedom Finance, which has been working in the local market since 2012, and Freedom Finance Global, a broker that has operated within the jurisdiction of the Astana International Financial Center since 2021.

Any resident of Kazakhstan as well as international clients can open an account at Freedom Finance Global.

As of today, Freedom Finance has more than 264,000 clients with about 4,800 accounts opened per month on average in Kazakhstan.

A typical customer of Freedom Finance is male, over 30 years old, and has $15,000 in assets on deposit.

In January 2024, Freedom Finance moved all its customers previously registered with a broker in Belize to its companies in the CIS where approximately 10% switched to a subsidiary in Armenia, and 90% to Freedom Finance Global in Kazakhstan.

The move helped the parent company boost its number of clients, assets, business dealings, and fees.

The Nasdaq accounts for the vast majority of the brokerage’s trading transactions and the Kazakhstan Stock Exchange (KASE) is the second biggest exchange for the enterprise.

Improvement of Tradernet for a better customer experience

According to brokers within the Freedom organization, many customers are showing a greater interest in derivative financial instruments.

As a result, since the beginning of the year, the company has been offering its customers the ability to trade options and futures on its Tradernet platform, where clients can access many new assets like NANOS options for the S&P 500, a popular and handy tool for speculative trading.

As a platform, Tradernet is constantly expanding and being improved.

Recently, it has started offering exclusive ideas to its premium clients for investments, and in 2023, the company’s analysts published 525 investment ideas which were viewed 17.5 million times.

The platform also has a news section feed by Kursiv, a business media outlet in Kazakhstan. In addition, it ensures users’ security by verifying each user’s device and sessions through QR codes, which leaves little room for scamming.

One the of most anticipated novelties by Tradernet is Typi Chat, a chat tool for clients designed for better communication with customer support, managers, and other users.

The tool will also help clients transfer money and assets in a risk-free environment.