Our Company’s Business Model At A Glance

The Group is an innovative provider of online retail financial services operating in Russia through a high-tech low cost platform. We refer to this as the ‘Tinkoff Business Model’.

The Group is the second largest credit card issuer in the Russian market.  While credit cards constitute the Group’s core business, the Group is diversifying the scope of its non-credit products and services made available to customers on both a proprietary and broker-service basis through its one-stop online customer service destination, the Tinkoff.ru platform (also referred to as the Financial Supermarket).  Such additional non-credit product lines typically require limited capital investment but provide a valuable opportunity to diversify the Group’s sources of revenue, attract new customer segments and drive customer traffic, thereby generating further opportunities for cross-selling.  

The Group’s business operations are carried out across Russia. The Group also has a presence in Cyprus where the holding company is headquartered and operates home call centre and software development businesses, as well as subsidiaries in Latvia and Kazakhstan.

The Tinkoff Business Model is focused on its online platform, Tinkoff.ru, an advanced high-tech retail financial services platform with more than 10 million monthly visitors. The Tinkoff.ru website acts as a centralised customer acquisition platform through which the Group’s wide range of credit and non-credit products and services are made available to customers. The platform is characterised by advanced functionality and is supported by the Group’s award-winning Internet bank and mobile banking services and its high-volume call centres. The Group’s primary customer acquisition channels are Internet and Mobile but it also uses direct sales agents and partnerships (co-brands) to acquire customers. These customer acquisition models, combined with the Group’s virtual network, afford it a geographic reach across all of Russia’s regions, resulting in a highly diversified portfolio.

The Group’s main marketing and distribution channels are its online channels (Internet, mobile and telesales), which, the Group’s management believes, optimise the scope of its coverage and allow it to access otherwise underserved parts of the country. The Group’s “smart courier” delivery network enables it to deliver cards and other products and services to consumers throughout Russia within one or two days. This infrastructure-light operating structure provides a low fixed cost base and high degree of flexibility to ramp the business up or slow the business down according to the external environment. 

The Tinkoff  Business Model involves extensive outsourcing of various customer service and operating functions. 

The Group’s operations are supported by its advanced IT capabilities, which underpin the operational efficiency of its Tinkoff.ru platform and its online/remote service business model. Further, the Group’s focus on data analysis enable it to target its marketing and product offerings effectively and give it an advantage in its underwriting, risk analysis and collection processes. The Group’s management believes that the relatively low level of retail financial services penetration, relatively high margins and regulatory and technology barriers to entry for the Group’s competitors make the Tinkoff Business Model attractive in terms of growth potential and competitive edge. 

The Group’s management believe that the Group is one of the most recognisable and popular brands in Russian financial services.  The Group’s brand recognition is very strong due to the high profile persona of its founding shareholder Mr Oleg Tinkov, from whose last name the brand originates. The name “Tinkoff” is associated with Mr Tinkov’s well-known entrepreneurial activity that has launched a number of successful businesses and brands in Russia. The Group’s marketing and public relations divisions are highly attuned to the latest consumer and online trends and use a variety of communication channels, including its online platform, Tinkoff.ru, and social networks (Instagram, Twitter.com, Facebook.com, YouTube, Odnoklassniki.ru and Vkontakte.ru) to further enhance the Group’s brand recognition.

The Group’s strategic goal is to become an integrated retail financial services provider serving customers through a high-tech online platform that offers premium-quality service and convenience, while maintaining profitability and effective data-driven risk management. 

Since its launch in April 2016, the Group’s online platform, Tinkoff.ru, has become central to its flexible Business Model, creating a high-quality, scalable platform through which consumers can access both proprietary and broker-based products and services. With approximately 10 million visitors a month on average throughout 2017, the Tinkoff.ru platform attracts high-volume internet traffic, making it a key tool for customer acquisitions and marketing. 

The Group intends to continue to develop the functionality of Tinkoff.ru, and its other mobile and online presence, in order to provide a convenient, one-stop destination which consumers can use to satisfy the full range of their retail financial needs, thereby growing both the total number of the Group customers and increasing the amount of products and services used by each customer. 

The Group’s management believes that by enhancing the Group’s online presence in this manner it will improve access to customers in regions underserved by physical bank branches and to customers from more affluent and tech-savvy demographics that spend more time online and tend to utilise more financial services. Further, it is expected that, as traffic on its Tinkoff.ru platform increases, the Group will gain access to additional data on consumer trends and preferences which it can use to further refine its marketing and credit analysis and underwriting processes.   

The Group is evolving rapidly into a unique lifestyle banking solution and will continue to expand the range of products and improve the quality of its customer service.