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$17 million fraud rocks Jumia as company battles with several US lawsuit

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Economy

Jumia is currently involved in some issues which are threatening its corporate existence. The company is facing class-action lawsuits in the United States as a member of its staff engaged in fraud worth $17.5 million and the company’s financial report revealed that its loss grew by 59.2% in one year. 

Jumia’s staff and some members of the Jumia Force (Jumia’s agents) were said to have inflated the volumes of order on the marketplace. 

Although Jumia claimed the fraudulent activity didn’t affect its figures in the financial statement, the improper order accumulated to $17.5 million in Gross Merchandise Volume (GMV) value between Q4 of 2018 to Q1 and Q2 of 2019. 

Why GMV matters: GMV is the metric used by e-commerce companies to identify the total values of merchandise sold through their online platforms 

Jumia reportedly adjusted its GMV figures for Q2 2018 financial report due to the internal fraud the company discovered. 

The fate of the staffs who were involved in the improper orders is not known yet, as the company is still reviewing the case. The suspects have, however, been suspended pending the outcome of the probe. 

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Jumia store

Why the improper fraud: Such unethical activity is not new in the corporate environment. Workers usually embark on fraudulent activities to meet their companies’ demand/target and navigate through office pressure. One of the most recent was the account scandal that hit one of the biggest banks in the United States, Wells Fargo, in 2016. 

The company sacked 5300 employees for secretly opening two million bank and credit card accounts without the customers’ knowledge while the customers were charged for accounts they didn’t openWells Fargo received the unwarranted fees while the sacked workers made more money and boosted their sales figures. 

Financial mess: Despite Jumia’s topline, active customers, marketplace revenue and gross profit grew within the year, the company’s growth was overshadowed by its net losses which significantly increased by 59.2% between last year and this year. 

The highlight of Jumia’s financial statement

  • Jumia’s topline second-quarter revenue grew to €39.2 million from €24.8 million a year ago.  
  • Net losses increased significantly from €42.3 million last year to €67.8 million this year. 
  • Active customers grew by 500,000 to hit 4.8 million in Q2 of 2019 when compared to Q1 of 2018. 
  • GMV increased by 69% year-on-year. 
  • Marketplace revenue grew 90% year-on-year. 
  • Gross profit according to Jumia also surged by 94% year-on-year. 
  • Jumia’s stocks drop by 13% as at yesterday’s trading. 

Note that since entering the e-commerce business in 2012, Jumia has lost N362.3 billion ($1 billion) in total. 

Jumia Food

Class action lawsuit: The problem with the inflated numbers that arose from the improper orders of Jumia’s staff is that it increased the trust issues Jumia is struggling with among investors since listing its shares in the United States. 

Jumia has been accused of disclosing misleading information to favour the company and portray them as a healthy company to investors. This has led to class action lawsuit centered on “alleged misstatements and omissions” in its Initial Public Offering prospectus. 

While the lawsuit is still in its early stage, the accusations have been taking a toll on Jumia’s stock in the New Yock Stock Exchange (NYSE) where it had opted for an unusual listing of its sharesJumia’s stock price had peaked at $49.77 when it debuted. It has, however, crashed to N12.27 today (at the time of this report) although it was $12.21 yesterday, August 21, 2019.

Identity problem: Jumia also has an identity problem apart from the speculations of misinformation that has dragged down the brand on the Stock Exchange. While Jumia had positioned itself as an African e-commerce platform over the years, it was only after it listed on the NYSE that it was revealed that the company is a German registered company. The identity of the company has further caused confusion as many still don’t know if it is a Nigerian company or not. 

Culled: https://nairametrics.com

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Business

Keystone Bank rewards its Verve card holders with free petrol

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Fastest growing financial services provider, Keystone Bank Limited in partnership with Verve International, has launched a promotion to reward its customers for using its Verve Card to purchase petrol at select Oando Petrol stations across Nigeria.

 

According to a statement by the lender on Friday, the promo tagged “Free Fuel Alert” which is open to both new and existing customers of the bank will have Keystone Bank Verve Card holders receive free extra 5 litres of petrol each time they use their verve cards to purchase a minimum of N3,000.00 and above worth of petrol between 6am – 8pm every Friday from September 20 till November 8, 2019.

 

The selected Oando Petrol Stations where the promo will run are Lagos (Maryland, Marina, Awolowo Falomo, Awolowo Fire Station, Lawanson, Alapere, Ajah, Agege Bye-Pass, Trade Fair, Fola Agoro, Ojodu Berger, Sangotedo, Ago Palace Way and Shiro Road Fadeyi) Abuja (Garki, Ahmadu Bello Way and Zone 6 Wuse) Enugu (Ogui Road), Imo (Assumpta Avenue) Kaduna (Junction Road by Stadium), Kano (Club Road 1), Oyo (Orita Mef and Iwo Road, Southbound) Portharcourt (Aba Road and 75 Transamadi) Delta (Effurun Junction) Edo, Benin – City (Akpakpava Road).

 

While Keystone Bank Limited is a technology and service-driven commercial bank offering convenient and reliable solutions to its customers, Verve Card International is a secure debit card which allows the card-holder to conveniently meet day to day financial needs like the payment for goods and services, airtime recharge, bill payments, funds transfer amongst others.

 

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Africa’s Global Bank, UBA is Now Available on Apple Business Chat

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Group Head, Online Banking, United Bank for Africa(UBA) Plc, Mr Austine Abolusoro; Group Managing Director/CEO, Mr. Kennedy Uzoka; Group Head, Marketing, UBA Plc, Mrs Dupe Olusola; Executive Director, UBA Plc, Mr. Nweke Chukwuma; Group Head, Human Capital Management; Mrs Patricia Aderibigbe; and Group Executive, Customer Fulfilment Centre(CFC), Mr Anant Rao, during the launch of LEO, the Bank’s chatbot on banking, on Apple Business Chat –IPad and IPhone, held at UBA House, Marina, Lagos on Thursday

Uited Bank for Africa (UBA) Plc, on Thursday, announced that the services of its Chatbot, Leo is now available for customers on Apple Business Chat, where its users can communicate directly with businesses using the Messages app on iPhone and iPad.

“As a brand focused on providing excellent customer experience, we are always looking for new ways to serve our customers easily and on time; we are therefore thrilled to support Apple Business Chat, which gives us a powerful and engaging connection with our customers,” said Mr. Kennedy Uzoka, Group Managing Director of UBA, who spoke at the launch of the service in the bank’s Head office on Thursday. “Most of our customers prefer iOS, and we always want to exceed their expectations when they experience UBA. Apple Business Chat makes communicating with us as easy as messaging a friend, so we expect it will quickly become our customers’ preferred customer service channel.”

He explained that UBA customers can now use the services of LEO, through the Apple Business Chat to open an account, buy airtime, check account balance, make account transfers and pay bills. With Business Chat, customers can always reach a live person and are always in control of whether they share any contact information with a business.

Uzoka said, “Today, we are covering a segment that has been missing for some time. It is our desire to ensure that we put Leo everywhere, and today it is now on the IOS platform as the users approached us that they needed to enjoy the service which Facebook and WhatsApp users had been enjoying from LEO. Consistently, we have been the first in the use of intelligence banking, this is the first time this is happening in Africa. LEO is live in English on the IOS platform, and by the end of October, it will be live in other languages. As you know, LEO is already on WhatsApp and Facebook  in English, French, Portuguese and Swahili languages.”

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To start Apple Business Chat, customers can click the ‘Chat with Messages’ button on UBA’s website or in mobile banking app, available in the App Store. A conversation with UBA’s agents will open instantly in the Messages app, and users can take their time responding when it’s convenient.

The Group Head, Online, Banking, Austin Abolusoro, who spoke at the event said the bank is always looking for ways to improve upon its services to its teeming customers.

“We are leading financial industry AI in Africa. Our customers have been increasingly asking for mobile services that make their lives easier, and Leo has become a growing choice for his convenience and personal solutions, Over a million customers are already on the LEO platform. Before now, customers can only come to the bank, but today we are on social media as well as on the IOS platform, and the launch of LEO has helped customer to get their complaints resolved without physically visiting the bank. Leo makes use of available data to resolve complaints and where more information is needed, Leo will transfer the customer to human agents.”

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“As we continue to advance our work on AI-driven developments, it is important that we listen to our users today and further enhance Leo to align to client feedback in order to better meet and anticipate needs and even continue to give them increased value,” Abolusoro added.

He added that Apple Business Chat is available in beta for users and businesses around the world, and is built into iOS 11.3 and higher. For more information, visit: apple.com/ios/business-chat.

United Bank for Africa, Africa’s global bank, was founded 70 years ago in Nigeria and today, operates in 20 African countries and in the United Kingdom, the USA and with presence in France. UBA serves over 17 million customers across the globe with more than 1000 branches and touch points. In 2018, the bank received the award of Africa’s Best Digital Bank by the Banker’s magazine.

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Nigeria Seeks $2.5bn Loan From World Bank

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Hafez Ghanem

The Federal Government of Nigeria is set to obtain a fresh loan of $2.5bn loan from the World Bank.

This is according to World Bank Vice President for Africa, Hafez Ghanem.

Ghanem disclosed this in an interview with Bloomberg in Abuja on Wednesday.

“We are talking about a new set of programmes of about the same amount, it should be around $2.5bn,” he said.

“It is important to resolve the problems of the power sector in Nigeria to bring in more investments because you need to bring down the cost of power to make the economy more competitive for the development of industries,” Ghanem further said.

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According to Ghanem, Nigeria has received $2.4bn from the World Bank in the past year.

Presently, the country’s domestic debt stands at $55.6bn, while foreign loans stand at $25.6bn.

However, the country’s Minister of Finance, Budget and National Planning, Zainab Ahmed, has been quoted saying that the country does not have a debt problem.

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According to her, the country’s problem is revenue. Ahmed had said, “There is a lot of insensitivity around the level of our debt. I want to restate that our debt is not too high; what we have is a revenue problem.

“Our debt is still very much within a reasonable fiscal limit. In fact, amongst our comparative countries, we are the least in terms of borrowing.”

 

 

 

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