Project Name: Micro Lending Solutions

Customer Name: OOREDOO Group

REF: OA/RFP/MicroLending

www.mo-de.com

Commercial Proposal

5 April 2021
Project Name: Mobile Financial services
Customer Name: OOREDOO Qatar
REF: RFI Micro Lending

TABLE OF CONTENTS
1 Commercial Proposal 3
1.1 Commercial model........................................................................................................................................... 3
1.2 Proposed revenue share of the Service Fee........................................................................................... 3
1.3 Proposed Term of the ACS Agreement.................................................................................................... 3
1.4 Zero Capex to OOREDOO operations........................................................................................................ 3
1.5 Zero Opex to OOREDOO operations.......................................................................................................... 4
1.6 0% Bad debt exposure to OOREDOO operations................................................................................ 4
1.7 More than adequate Bank Guarantee to cover bad debt..................................................................4
1.8 Financial model................................................................................................................................................. 4
1.8.1 Assumptions......................................................................................................................................................... 4
1.8.2 Total operations summary............................................................................................................................ 4
1.8.3 Commercial model (12 months)........................................................................................................... 6

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 Project Name: Mobile Financial services
Customer Name: OOREDOO Qatar
REF: RFI Micro Lending

1 Commercial Proposal
1.1 Commercial model
AL-RESALA MODE is proposing the following model;
 Service fee model: This is the most common model. Under this model the
operator charges the customer a service fee, which is shared with the vendor.
The vendor does not receive any commission or discount for bulk airtime
purchase

Service Fee to
customer 20% on QR 5, 15% on QR 10 

1.2 Proposed revenue share of the Service Fee

Revenue Share % to Ooredoo Qatar 60%
Commercial
Revenue Share % of partner 40%

Unlike many other VAS services, ACS needs a certain minimum return in
order for it to cover the following costs:
a) Bad debt provision
b) Cost of funding for the bank facilities
c) Operating costs (it is a managed service requiring constant
optimization)
d) Topline taxes (e.g. VAT, Excise etc.)

1.3 Proposed Term of the ACS Agreement

3-year agreement with a 2-year automatic renewal subject to agreed KPIs. This gives
the vendor sufficient time to recoup their investment.

1.4 Zero Capex to OOREDOO operations

AL-RESALA MODE will be responsible for all the capital expenditure associated with
installing its application. This expenditure will cover:
e) Servers for both the main data center and the DR site
f) All the 3rd party software associated with the service
g) Database
OOREDOO will be responsible for providing Rackspace, cables and power associated
with integrating the service.
OOREDOO will be responsible for making any minor changes to its infrastructure that
may be required to ensure that the service is optimal.

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Project Name: Mobile Financial services
Customer Name: OOREDOO Qatar
REF: RFI Micro Lending

1.5 Zero Opex to OOREDOO operations

AL-RESALA MODE will be 100% responsible for maintaining and running the platform.

1.6 0% Bad debt exposure to OOREDOO operations

AL-RESALA MODE will be responsible for 100% of all the bad debt. The bad debt will be
determined by the amount of Airtime advance held by churned customers;
a) Amount of bad debt will be offset against fees owed each month;
b) If the fees are lower than the bad debt, OOREDOO will send a demand note to AL-
RESALA MODE to pay using cash.
c) If AL-RESALA MODE is unable to pay by cash, OOREDOO will have the right to call on
the bank guarantee.

1.7 More than adequate Bank Guarantee to cover bad debt

AL-RESALA MODE will provide OOREDOO with a guarantee from a credible local or
international bank to give it comfort that all bad debt risk is covered.
1.8 Financial model

Assumptions
ACS ASSUMPTIONS
Lending assumptions
Launch date date 01/10/17
Contract length # months 36
Active prepaid subscribers (30-day) # 1,710,000
Subscriber growth % p.a. 2.0%
Qualified subscribers % subs 80.0%
Qualified subscribers # 1,368,000
ARPU USD 26.00
ARPU growth % p.a. 0.0%
Average transaction value % ARPU 7.5%
Average transaction value USD 1.95
Average monthly users (monthly penetration) % subs 25.0%
Average monthly users # 342,000
Average transactions per user per month # 2.0
Average monthly transactions # 684,000
Average monthly lending USD 1,333,800
Ramp-up period # months 3.0
Commercial terms with Telco
Service fee % lending 15.0%
Service fee after VAT % lending 14.3%
Commission % lending 0.0%
Bad debt % lending 3.0%
Bad debt realisation period # months 3.0
Telco share of fees % share 60.0%
Payment terms # months 1.0

Total operations summary

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Project Name: Mobile Financial services
Customer Name: OOREDOO Qatar
REF: RFI Micro Lending

TOTAL OPERATION
Lending KPIs
USD Year 1 Year 2 Year 3
Active subs 1,725,619 1,760,131 1,795,334
Qualified subs 1,380,495 1,408,105 1,436,267
Users - monthly 316,608 352,026 359,067
Transactions - monthly 633,216 704,053 718,134
Transactions - annually 7,598,594 8,448,630 8,617,603
Average transaction value 1.95 1.95 1.95
Lending - monthly 1,234,772 1,372,902 1,400,360
Lending - annual 14,817,259 16,474,829 16,804,326
Daily transactions % qual. 1.5% 1.6% 1.6%

REVENUE FINANCIALS
Operational P&L
USD Year 1 Year 2 Year 3
Gross fees (after VAT) 2,116,751 2,353,547 2,400,618
Telco share (1,270,051) (1,412,128) (1,440,371)
Net fees 846,701 941,419 960,247
Bad debt (444,518) (494,245) (504,130)

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Project Name: Micro Lending Solutions
Customer Name: OOREDOO Group
REF: OA/RFP/MicroLending

Commercial model (12 months)

Months 1 2 3 4 5 6 7 8 9 10 11 12
Lending KPIs
Active prepaid subscribers (30-day) 1,710,000 1,712,824 1,715,653 1,718,487 1,721,325 1,724,168 1,727,015 1,729,868 1,732,725 1,735,586 1,738,453 1,741,324
Growth 0.2% 0.2% 0.2% 0.2% 0.2% 0.2% 0.2% 0.2% 0.2% 0.2% 0.2%
Qualified subscribers 1,368,000 1,370,259 1,372,522 1,374,789 1,377,060 1,379,334 1,381,612 1,383,894 1,386,180 1,388,469 1,390,762 1,393,059
Qualification rate (qualified % active subs) 80.0% 80.0% 80.0% 80.0% 80.0% 80.0% 80.0% 80.0% 80.0% 80.0% 80.0% 80.0%
Monthly users 114,000 228,377 343,131 343,697 344,265 344,834 345,403 345,974 346,545 347,117 347,691 348,265
Monthly penetration (users % qualified subs) 8.3% 16.7% 25.0% 25.0% 25.0% 25.0% 25.0% 25.0% 25.0% 25.0% 25.0% 25.0%
Transactions per month 228,000 456,753 686,261 687,395 688,530 689,667 690,806 691,947 693,090 694,235 695,381 696,530
Average transactions per user per month 2.0 2.0 2.0 2.0 2.0 2.0 2.0 2.0 2.0 2.0 2.0 2.0
ARPU 26.00 26.00 26.00 26.00 26.00 26.00 26.00 26.00 26.00 26.00 26.00 26.00
Growth 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0% 0.0%
Average transaction value 1.95 1.95 1.95 1.95 1.95 1.95 1.95 1.95 1.95 1.95 1.95 1.95
Average transaction value % ARPU 7.5% 7.5% 7.5% 7.5% 7.5% 7.5% 7.5% 7.5% 7.5% 7.5% 7.5% 7.5%
Monthly lending 444,600 890,669 1,338,209 1,340,420 1,342,633 1,344,851 1,347,072 1,349,297 1,351,525 1,353,757 1,355,993 1,358,233
Growth 100.3% 50.2% 0.2% 0.2% 0.2% 0.2% 0.2% 0.2% 0.2% 0.2% 0.2%
Daily transactions 7,500 15,025 22,574 22,612 22,649 22,686 22,724 22,761 22,799 22,837 22,874 22,912
Daily transactions % qualified subs 0.5% 1.1% 1.6% 1.6% 1.6% 1.6% 1.6% 1.6% 1.6% 1.6% 1.6% 1.6%
Cash flow waterfall (USD)
Gross fees after VAT 63,514 127,238 191,173 191,489 191,805 192,122 192,439 192,757 193,075 193,394 193,713 194,033
Ooredoo share of fees (38,109) (76,343) (114,704) (114,893) (115,083) (115,273) (115,463) (115,654) (115,845) (116,036) (116,228) (116,420)
Bad debt provision (13,338) (26,720) (40,146) (40,213) (40,279) (40,346) (40,412) (40,479) (40,546) (40,613) (40,680) (40,747)
Project Name: Micro Lending Solutions
Customer Name: OOREDOO Group
REF: OA/RFP/MicroLending