Paz continues to expand its operations in the financial field: Will cooperation with ICC

Paz continues to expand its operations in the financial field as part of its attempt to leverage its growing retail presence. Paz, which is managed by Nir Stern, has signed an agreement for cooperation with ICC, from the Discount Group and International, for the purpose of marketing non-bank loans, which will be provided by ICC through the Yellow app.
The agreement was signed for three years with an option for Paz to extend the agreement for two periods of one year each. According to the agreement, ICC will provide the non-bank loans and will take over the underwriting, operation and credit risk, while Paz will provide the Yellow app and its customer base.
The two companies will share the profit from the activity according to an unspecified distribution, but according to those close to the transaction, the distribution will be equal. Paz's Yellow app offers, among other things, a digital wallet with an accumulation and discharge mechanism used by 500,000 people.
The app, which has so far been downloaded by 1.2 million people, reached a turnover of NIS 1 billion in 2021. It is expected to grow significantly and be one of the strongest in Israel, with the addition of three customer clubs: of the Sofer Yoda network of writers in the first quarter of 2022; The customer club that includes 700,000 members of the Pazgaz subsidiary in the second quarter of 2022; And the Freshmarket customer club, which was acquired in January 2022, for NIS 2.1 billion.
The app is designed to strengthen customer loyalty, and in the case of non-bank loans, generate a profit of millions of shekels a year, which will help expand and finance the benefits. Yellow's digital wallet entitles its users in the Yellow stores to accumulate 10% of the purchase value, a discount of 10 cents per liter when refueling at Paz stations, and will give its users an accumulation of 5% of the purchase value in the Super Yoda stores.
According to an agreement signed between Paz and the Super Pharm network, Super Pharm's credit card holders are entitled to a discount of 10 cents on refueling at Paz stations, and Paz app owners can unload the amounts accrued to their credit in the digital wallet in the Super Pharm network.
The first step in developing Yellow's financial operations was an agreement signed in November 2021 with Harel Insurance Company. The agreement included marketing a car-adapted travel insurance called "Harel Switch", for Yellow digital wallet customers, as part of which wallet owners will enjoy a 10% refund and 250 km free travel in the switch. Switch is a GPS-based application, launched two years ago, and includes Tens of thousands of registered customers who are supposed to save hundreds of shekels after purchasing the policy, which suits their travel characteristics.The need for this type of product accelerated with the outbreak of the Corona crisis and increased awareness of the need for user-based car insurance.
According to estimates following the agreement with Harel and ICC, Paz plans to launch a credit card for digital wallet holders - similar to Shufersal's credit card and Super Pharm's Life credit card. It is likely that ICC will also have the advantage of cooperating with Yellow in issuing a credit card, but Paz is not legally obligated to ICC.