Sber investing heavily in digital ecosystem

RUSSIA / FSU POLITICS - In Brief 05 Aug 2021 by Alex Teddy
Sber is investing USD billion in its digital ecosystem in Q1 and Q3 2021. Sber wants to be the main actor in Russia's tech space. The investment is 11.5% of Sber's profits. It was previously called Sberbank. Profits were USD 8.3 billion in Q1 and Q2 2021.Sber has invested heavily in its ecosystem and non-financial products. It spent more 201 thus far than in the previous 3 years put together. Sber wants to spend USD 4.1 billion over the next 3 years on upgrading its ecosystem.The digital ecosystem includes Sber's non-financial products and services. These have brought in USD 1 billion in profits in 2021 and Q1 and Q2. That is thrice what this generated in 2021.E-commerce makes up half of Sber's digital revenue. The gross merchandise value has risen 13-fold YoY to over USD 400 million.Sber has a joint venture with O2O. This involves foodtech, transport, startups etc... It co-owns Mail.Ru and this generated USD 310 million.Losses in the ecosystem arm reached USD 260 million. The bank has striven to win a serious chunk of one of the fastest growing sectors of the economy. In 2020 the Russian e-commerce sector was one of the most rapidly growing in the world. In terms of physical goods it sold USD 37 billion. That was a 58% increase YoY.Sber's competitors are also putting money into digital upgrades especially with regard to e-commerce. Yandex is investing USD 560 million in 2021 to develop its online retail. Yandex says its GMV will grow 300% in 2021.

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