Currency Exchange International : 1st Quarter Management's Discussion and Analysis

Currency Exchange International, Corp.

Management's Discussion and Analysis

For the Three-Month Periods Ended January 31, 2024 and 2023

Management's Discussion and Analysis

(All amounts are expressed in U.S. Dollars unless otherwise noted) For the three-month periods ended January 31, 2024 and 2023

Scope of Analysis

This Management Discussion and Analysis (MD&A) covers the results of operations and the financial condition of Currency Exchange International, Corp. (CXI or the Company) and its subsidiaries for the three-month periods ended January 31, 2024 and 2023, including the notes thereto. This document is intended to assist the reader in better understanding and assessing operations and the financial results of the Company.

This MD&A was prepared as at March 13, 2024 and should be read in conjunction with the condensed interim consolidated financial statements of the Company for the three-month periods ended January 31, 2024 and 2023, and the notes thereto. A detailed summary of the Company's material accounting policies is included in Note 2 of the Company's audited consolidated financial statements for the years ended October 31, 2023 and 2022. The functional currency of the Company and its wholly owned subsidiary eZforex.com, Inc. (eZforex) is the U.S. Dollar. The functional currency of the Company's wholly owned Canadian subsidiary, Exchange Bank of Canada (EBC or the Bank), is the Canadian Dollar. The Company's presentation currency is the U.S. Dollar. Unless otherwise noted, all references to currency in this MD&A refer to U.S. Dollars. The condensed interim consolidated financial statements and the MD&A have been reviewed by the Company's audit committee and approved by its board of directors.

In this document "Company," and "CXI" refer to Currency Exchange International, Corp. collectively with its wholly owned subsidiaries, eZforex and EBC.

Additional Information

Additional information relating to the Company, including annual financial statements, and the Company's annual information form, is available on the Company's SEDAR+ profile at www.sedarplus.caand on the Company's website at www.cxifx.com.

Forward-Looking Statements

This MD&A contains certain "forward-looking information" as defined in applicable securities laws. These statements relate to future events or the Company's future performance. All statements other than statements of historical fact are forward- looking information. Often, but not always, forward-looking information can be identified by the use of words such as "plans", "expects", "budgeted", "scheduled", "estimates", "continues", "forecasts", "projects", "predicts", "intends", "anticipates" or "believes", variations or the negatives of such words and phrases, or state that certain actions, events, or results "may", "could", "would", "should", "might" or "will" be taken, occur, or be achieved. The forward-looking information in this MD&A is based on the date of this MD&A or based on the date(s) specified in such statements. The following table outlines certain significant forward-looking information contained in this MD&A and provides the material assumptions used to develop such forward-looking information and material risk factors that could cause actual results to differ materially from the forward- looking information.

	Forward-Looking Information		Assumptions		Risk factors
			All factors other than the variable in question remain
	Sensitivity analyses relating to		unchanged; CXI's entire unhedged balance of foreign		Fluctuations of exchange rates and
	foreign currencies and interest		currency holdings is affected uniformly by changes
			interest rates
	rates		in exchange rates; CXI's interest-bearing instruments
			and obligations were constant during the period

Q1 2024 Report | 1

Management's Discussion and Analysis

(All amounts are expressed in U.S. Dollars unless otherwise noted) For the three-month periods ended January 31, 2024 and 2023

Inherent in the forward-looking information are risks, uncertainties, and other factors beyond the Company's ability to predict or control. Please refer to the Financial Risk Factors section beginning on page 18. Readers are cautioned that the above table does not contain an exhaustive list of the factors or assumptions that may affect the forward-looking information in this MD&A, and the assumptions underlying such statements may prove to be incorrect. Actual results and developments are likely to differ, and may differ materially from those expressed or implied by the forward-looking information contained in this MD&A.

Forward-looking information involves known and unknown risks, uncertainties, and other factors that may cause the Company's actual results, performance, or achievements to be materially different from any of its future results, performance, or achievements expressed or implied by the forward-looking information. All forward-looking information herein is qualified by this cautionary statement. Accordingly, readers should not place undue reliance on forward-looking information. The Company undertakes no obligation to update publicly or otherwise revise any forward-looking information, whether as a result of new information, future events, or otherwise, except as may be required by applicable securities laws. If the Company does update any forward-looking information, no inference should be drawn that it will make additional updates with respect to that or other forward-looking information, unless required by applicable securities laws.

Overview

The Company is a publicly traded company (TSX: CXI; OTCBB: CURN) with its head office in Orlando, Florida, and is a reporting issuer in the provinces of British Columbia, Alberta, and Ontario. It specializes in providing currency exchange and related products to financial institutions, money service businesses, travel companies, other commercial and retail clients through its proprietary software platform, company-owned branches and vaults, and inventory on consignment locations throughout the United States and in Canada, through its wholly owned subsidiary, Exchange Bank of Canada. EBC, located in Toronto, Ontario, is a non-deposit- taking, non-lending Schedule 1 Canadian bank that participates in the Federal Reserve Bank of New York's (FRBNY) Foreign Bank International Cash Services (FBICS) program, a competitive advantage in the Canadian and global markets for the trade of U.S. Dollar banknotes. At January 31, 2024, the Company had 406 employees, 91 of which were employed on a part-time basis.

The Company has developed CXIFX, its proprietary, customizable, web-based software, as an integral part of its business and believes that it represents an important competitive advantage. CXIFX is also an online compliance and risk management tool that integrates with core bank processing platforms to allow a seamless transaction experience. This includes an OnlineFX platform that allows it to market foreign exchange products directly to consumers that operate in 41 States. The trade secrets associated with CXIFX are protected via copyright, restricted access to both the software and its source code, and secure maintenance of source code by a team of software engineers employed by the Company.

Background

The Company has the following revenue streams which it reports in its financial documents as commissions or fees revenue:

Commissions revenue comprises the difference (spread) between the cost and selling price of foreign currency products, including banknotes, wire payments, cheque collections and draft issuances (foreign currency margin), together with the net (realized or unrealized) gain or loss from foreign currency forward contracts with customers, and the commissions paid on the sale and purchase of currencies. The amount of this spread is based on competitive conditions and the convenience and value-added services offered.

Fees revenue primarily comprises the following:

1. Fees generated at the Company's branch locations and certain inventory on consignment locations from foreign currency (banknote) exchange, traveler's cheques, currency price protection, and fees collected on payroll cheque cashing; and
2. Fees collected on foreign-denominated wire transfers, drafts, and cheque-clearing transactions.

The following are some of the characteristics of the Company's revenue streams:

The Company operates five vaults serving the Company's operations in Canada and the United States that serve as distribution centers for its branch network, as well as order fulfillment centers for its clients including financial institutions,

Q1 2024 Report | 2

Management's Discussion and Analysis

(All amounts are expressed in U.S. Dollars unless otherwise noted) For the three-month periods ended January 31, 2024 and 2023

money-service businesses, and other corporate clients. Revenues generated from vaults have greater scale as the Company maintains a sales force to increase its geographic customer base. Exchange rate margins vary from customer to customer and are dependent on criteria such as exchange volumes and customer setup. Onboarding of new clients, specifically banking clients, normally requires an upfront investment, such as training, and currency signage, as well as additional onetime shipping costs to distribute start-up materials. The Company also normally absorbs information technology costs to customize the CXIFX software for specific client use during the customer implementation phase. There are two common customer setups:

1. Centralized setup - for customers with a high volume of foreign currency exchange who maintain and manage their own inventory in central vault facilities. The Company offers bulk wholesale banknote trading. Trades of this nature are generally executed at lower margins, as the cost per transaction is low and the average value is high. The customer implementation phase is normally shorter, and the costs of onboarding clients is low; and
2. Decentralized setup - many customers have determined that it is advantageous to avoid a currency inventory and allow their locations to buy and sell directly from CXI. Transactions in a decentralized setup typically are executed at a higher margin, as the average transaction is low and the cost to fulfill each trade is higher than that of a centralized setup. Several of the Company's financial institutions outsource their currency needs in return for a commission, based upon exchange volume. When a customer outsources their currency needs, the Company is granted access to the entire branch network, thus, immediately increasing its geographic footprint and expanding its customer base. The customer implementation phase is normally longer in a decentralized setup and the cost of client onboarding is higher as these clients normally require additional training and support.

CXI and EBC maintain inventory in the form of domestic and foreign banknotes in financial institutions and other high-traffic locations. These locations can be very profitable as there are no occupancy costs or payroll. Foreign exchange currency is placed in these locations on a consignment basis. On January 31, 2024, the Company had inventory on consignment in 698 locations, primarily located inside financial institutions across the United States and Canada. To encourage inventory turnover, the Company offers commission as a percentage on volumes generated by these locations. The table below lists the number of wholesale customer relationships and total number of unique active locations that transacted during each of the previous five fiscal years.

	FY 2020	FY 2021	FY 2022	FY 2023	FY 2024 (Q1)
Wholesale customer relationships	1,667	2,481	2,586	2,658	3,017
Number of transacting locations	14,787	15,202	22,170	22,551	18,3931

1Note that the number of transacting locations in FY2024 only reflect the activity of the three-month period ended January 31, 2024 and not a full year. This period is also not the busiest period of the year based on typical travel seasonality. For the three-month period ended January 31, 2023, there were 16,567 transacting locations.

The Company's strategy includes an omni-channel,direct-to-consumer approach that allows it to build its brand as a premier provider of foreign currencies in the United States. This includes operating a number of company-owned branch locations that are located in typically high-traffic areas in key tourism markets across the United States, staffed by CXI employees. These locations hold domestic and foreign currencies to buy and sell on demand. The currency exchange margins associated with the transactions occurring at these locations are generally higher in order to recapture costs of deployed capital in the form of domestic and foreign currencies, rent, payroll, and other general and administrative costs. Company-owned branch locations generate a significant amount of revenue from the exchange of foreign currency, whereas CXI is generally a net seller of currencies to its bank and non-bank clients. Excess currency collected via the branch network can be redeployed to financial institutions and non-bank clients, which reduces the need to source currency through wholesale sources at a greater cost, thus increasing currency margins.

Q1 2024 Report | 3

Management's Discussion and Analysis

(All amounts are expressed in U.S. Dollars unless otherwise noted) For the three-month periods ended January 31, 2024 and 2023

As of January 31, 2024, the Company had 38 company-owned branch locations across the United States. The table below lists the individual company-owned branch locations operating in the United States as of January 31, 2024:

Locations	City	State	Opened	Locations	City	State	Opened
Florida Mall Booth #1	Orlando	FL	2007	Shops at Northbridge	Chicago	IL	2013
Ontario Mills Mall	Ontario	CA	2007	Apple Bank - Upper East Side	New York	NY	2014
Potomac Mills Mall	Woodbridge	VA	2007	Cherry Creek	Denver	CO	2014
Sawgrass Mills Mall Booth #1	Sunrise	FL	2007	Citadel Outlets	Los Angeles	CA	2014
Aventura Mall	Aventura	FL	2008	Tyson's Corner Center	Tyson's Corner	VA	2014
Copley Place Mall	Boston	MA	2009	Garden State Plaza	Paramus	NJ	2015
Dadeland Mall	Miami	FL	2009	Mission Valley	San Diego	CA	2015
Dolphin Mall	Miami	FL	2009	The Orlando Eye (Icon Park)	Orlando	FL	2015
MacArthur Mall	Norfolk	VA	2009	International Market Place	Honolulu	HI	2016
Apple Bank - Avenue of Americas	New York	NY	2011	North County	Escondido	CA	2017
Apple Bank - Grand Central	New York	NY	2011	Alderwood Mall	Lynnwood	WA	2019
San Francisco City Center	San Francisco	CA	2011	Pearl Ridge	Aiea	HI	2019
San Jose Great Mall	San Jose	CA	2011	South Coast Plaza	Costa Mesa	CA	2020
Arundel Mills Mall	Hanover	MD	2012	Stanford Shopping Center	Palo Alto	CA	2022
Santa Monica Place	Santa Monica	CA	2012	Century City Mall	Los Angeles	CA	2022
SouthCenter	Tukwila	WA	2012	Town Center at Boca Raton	Boca Raton	FL	2022
Apple Bank - Penn Station	New York	NY	2013	Jersey Gardens	New Jersey	NJ	2023
Mainplace at Santa Ana	Santa Ana	CA	2013	King of Prussia Mall	Pennsylvania	PA	2023
Montgomery at Bethesda	Bethesda	MD	2013	Orlando International Airport	Orlando	FL	2023

The Company has focused on growing its retail presence in the United States through agent locations with operators that bear the responsibility for the fixed costs, including lease commitments and other obligations associated with physical stores. In exchange for exclusive rights to supply and purchase foreign currencies to these agents, CXI consigns inventory to each location and licenses the right to use its name, thereby increasing its brand exposure. All agents are required to meet all of CXI's compliance and operational requirements under their agency agreements. CXI categorizes its agents between airport and non-airport locations, as airports have unique requirements. Through these relationships, CXI maintains a presence at some of the busiest airports in the United States for international traffic, including Charlotte, Chicago, Fort Lauderdale, Minneapolis, Newark, New York, Pittsburgh, Portland, Raleigh-Durham, and most recently Philadelphia's airport. CXI also has an agency relationship with Duty Free Americas for 29 locations at the busiest ports of entry across the border between the United States and Canada. This adds to the Company's prolific agent relationship with the American Automobile Association, which includes more than 200 locations across 17 states and the District of Columbia. The Company continuously monitors the performance of its agent locations and, as necessary, may discontinue relationships and/or close locations when volumes or revenues do not meet targets.

CXI launched its proprietary OnlineFX platform in 2020 to enable it to reach American consumers outside of its branch and agent network. The platform allows consumers to purchase foreign currency banknotes easily and securely, prior to their international travel. The platform enables consumers to buy more than 90 foreign currencies with direct shipment to their homes or for pick up at one of the Company's branches across the United States. OnlineFX is a core strategic initiative and adoption rates for online purchases are expected to continue to grow.

The following table lists the number of retail locations by category and the number of states in which the Company's OnlineFX platform operated as at January 31, 2024 and at the end of each of the five preceding fiscal years:

2019	2020	2021	2022	2023

Q1 2024

Company-owned branch locations	46	35	35	37	38	38
Airport agent locations	-	7	18	23	45	49
Non-airport agent locations	38	47	62	161	235	231
States in which OnlineFX operates	-	22	31	38	40	41

Q1 2024 Report | 4

Management's Discussion and Analysis

(All amounts are expressed in U.S. Dollars unless otherwise noted) For the three-month periods ended January 31, 2024 and 2023

The Company's largest asset is cash. The cash position consists of local currency banknotes, both in U.S. and Canadian Dollars, held in inventory at its branch and consignment locations as well as bank accounts to facilitate the buying and selling of foreign currency, as well as foreign currency banknotes held at the Company's vaults, branch locations, consignment locations, or cash inventory in transit between Company locations. The Company also has traditional bank deposits to maintain operations and as settlement accounts to facilitate currency transactions at various financial institutions.

Accounts receivable and payable balances consist primarily of bulk wholesale transactions that are awaiting collection and settlement. The credit risk associated with accounts receivable is limited, as the Company's accounts receivables consist primarily of bulk currency trades with a settlement cycle of 24 to 48 hours. The counterparty risk is generally low, as the majority of the Company's accounts receivable reside with financial institutions and money service business customers. The Company has longstanding relationships with most of its customers and has a strong repayment history.

Selected Financial Data

The following table summarizes the performance of the Company over the last eight fiscal quarters1:

Three-month	Revenue	Net operating	Net income	Total assets	Total equity	Earnings per
period ended		income				share (diluted)
	$	$	$	$	$	$
1/31/2024	18,106,918	2,247,267	849,874	133,780,438	80,520,993	0.13
10/31/2023	22,786,072	5,818,667	2,303,822	132,049,444	79,232,981	0.34
7/31/2023	23,587,589	6,438,354	4,056,478	129,643,409	77,590,126	0.60
4/30/2023	18,694,919	3,743,069	2,243,708	134,697,253	73,104,851	0.33
1/31/2023	16,886,189	2,734,159	1,589,499	133,072,968	71,448,732	0.24
10/31/2022	19,800,463	5,401,678	4,383,876	125,528,832	69,305,509	0.66
7/31/2022	21,145,189	7,321,521	4,585,808	155,757,016	65,598,381	0.70
4/30/2022	14,071,953	2,888,757	1,308,445	150,804,096	60,821,752	0.19

1Certain historical numbers in this table have been restated to conform with the numbers presented in the current period's financial statements.

While seasonality is generally not a consideration for the Payments product line, it has an impact on the Banknotes product line in the timing when foreign currencies are in greater or lower demand. In a normal operating year, there is seasonality to the Company's operations with higher commission revenue generally from March through September and lower commissions revenue from October through February. This coincides with peak tourism seasons in North America when there are generally more travelers entering and leaving the United States and Canada.

The Company developed a strategy of consolidation and diversification to mitigate the risk of financial losses associated with significant volatility in the domestic consumer driven banknote market. The strategy has five pillars, as follows:

1. Maximize profitability in the direct-to-consumer business by leveraging the agency model, OnlineFX platform and driving revenue growth at company-owned branches;
2. Increase its penetration of the financial institution sector in the United States through its "One Provider, One Platform" multi- product approach through integration of its proprietary software system with the leading core processing platforms for banks;
3. Increase its penetration in the global trade of banknotes by leveraging Exchange Bank of Canada's participation in the Federal Reserve Bank of New York's (FRBNY) Foreign Bank International Cash Services program (FBICS);
4. Develop scale in global payments for small and medium enterprises in Canada by leveraging strategic counterparty relationships through its subsidiary, Exchange Bank of Canada; and
5. Develop the infrastructure to support significant growth in transactional volumes and a matrix organizational structure.

Q1 2024 Report | 5

Management's Discussion and Analysis

(All amounts are expressed in U.S. Dollars unless otherwise noted) For the three-month periods ended January 31, 2024 and 2023

The Company reviews the strategy annually and monitors its execution against key performance indicators. The diversification strategy has been a significant factor in the Company's resilience and considers geopolitical and macroeconomic factors that influence consumer demand for travel.

The following is a summary of the results of operations for the three-month periods ended January 31, 2024 and 2023:

	Three-month	Three-month
	period ended	period ended	Change	Change
	January 31, 2024	January 31, 2023
	$	$	$	%
Revenue	18,106,918	16,886,189	1,220,729	7%
Operating expenses	15,859,651	14,152,030	1,707,621	12%
Net operating income	2,247,267	2,734,159	(486,892)	-18%
Other income, net	86,645	96,311	(9,666)	-10%
EBITDA*	2,333,912	2,830,470	(496,558)	-18%
Net income	849,874	1,589,499	(739,625)	-47%
Basic earnings per share	0.13	0.25	(0.12)	-48%
Diluted earnings per share	0.13	0.24	(0.11)	-46%

*Earnings before interest, taxes, depreciation and amortization

The Company generated revenue of $18,106,918 for the three-month period ended January 31, 2024, a 7% increase from the same period last year. The revenue increase over the comparable period was primarily driven by an increase in activity from travel resumption towards pre-COVID-19 levels, new customer acquisition in both the Banknotes and Payments product lines, partially offset by a decline in trade with foreign financial institutions by Exchange Bank of Canada reflecting reduced demand for USD volumes compared to the same time last year. Compared to the three-month period ended October 31, 2023, revenue decreased $4,679,154 or 21%, as demand for foreign currency decreased consistent with the seasonality associated with the Company's operations during the period. The top five currencies by revenue for the three-month period ended January 31, 2024 were the US Dollar (USD), Euro (EUR), Canadian Dollar (CAD), Mexican Peso (MXN), and British Pound Sterling (GBP). (Three-months ended January 31, 2023: US Dollar (USD), Canadian Dollar (CAD), Euro (EUR), Mexican Peso (MXN), and British Pound Sterling (GBP)).

The 7% growth in revenues of $1,220,729 was primarily due to growth in the retail market by $972,608. Revenue in the United States increased by $2,532,754, or 22% over the same period last year, while in Canada it declined by $1,312,025, or 25%. Corresponding with the revenue growth, operating expenses increased by $1,707,621, or 12%, primarily attributable to an increase in salaries and benefits. The Company recorded net operating income of $2,247,267 in the three-month period ended January 31, 2024, 18% lower than the same period in the prior year. Overall, the Company generated $849,874 in net income during the three-month period ended January 31, 2024, $739,625, or 47% lower than the same period last year, primarily attributable to the Canadian region as discussed further below.

The Company continued its progression along its three-year strategic plan in the three-month period ended January 31, 2024 that included the following highlights:

1. Continued its transaction growth in the International Payments product line in both Canada and the U.S. EBC initiated trades with 63 new corporate clients, representing an active trading client base of 814 during the same period. The Company processed 35,618 payment transactions, representing $2.99 billion in volume. This compares to 28,486 transactions on $3.11 billion of volume in the three-month period ending January 31, 2023;
2. Increased its penetration into the financial institution sector in the United States with the addition of 124 new clients, representing 135 transaction locations;
3. Continued its growth in the direct-to-consumer Banknotes market with the addition of 4 new airport agent locations, including

Q1 2024 Report | 6

Management's Discussion and Analysis

(All amounts are expressed in U.S. Dollars unless otherwise noted) For the three-month periods ended January 31, 2024 and 2023

two in Philadelphia airport, a first; and

1. Added the State of Alabama, making it the 41st State in which the Company provides its services through its OnlineFX platform. The platform is currently serving 89% of the U.S. population.

The Company's capital base has grown to $80.5 million. The Company remains well capitalized and maintains a credit facility in the amount of $40 million with its primary lender that further strengthens the Company's liquidity position to support its strategic plan. Refer to the Liquidity and Capital Resources section. The combination of a growing capital base and adequate borrowing capacity provides sufficient liquidity for the Company to meet its financial obligations. CXI is well-positioned to support its strategic initiatives that include the organic and inorganic acquisition of new clients in both the Banknotes and Payments product lines.

	As of January 31, 2024	As of October 31, 2023
	$	$
Total assets	133,780,438	132,049,444
Total long-term financial liabilities	3,623,388	2,719,288
Total equity	80,520,993	79,232,981

The following shows a breakdown of revenues for the three-month periods ended January 31, 2024 and 2023 by product line and geographic location:

Revenues by Product Line

	Three-month	Three-month
	period ended	period ended	Change	Change
	January 31, 2024	January 31, 2023
	$	$	$	%
Banknotes	14,327,062	12,987,341	1,339,721	10%
Payments	3,779,856	3,898,848	(118,992)	-3%
Total	18,106,918	16,886,189	1,220,729	7%

Three-month period ended January 31,	Three-month period ended January 31,
2024	2023
21%	23%
Banknotes	Banknotes
Payments	Payments
79%	77%

Q1 2024 Report | 7

Management's Discussion and Analysis

(All amounts are expressed in U.S. Dollars unless otherwise noted) For the three-month periods ended January 31, 2024 and 2023

Revenue by Product Line

Banknotes

Revenues in the Banknotes product line increased by $1,339,721 or 10% in the three-month period ended January 31, 2024, from the same period in 2023, due to strong demand from the increased travel levels in addition to larger demand of exotic currencies. This was evident by the continued growth in consumer demand for foreign currencies as international travel continued to strengthen in both the U.S. and Canada. Between November 2023 and January 2024, approximately 201 million travelers passed through TSA check points in United States airports, on par to pre-pandemic levels. This is an increase of 5% from the same time last year.

Direct-to-consumer Banknotes revenues increased by $972,608, or 19%. The Company's market share has continued to grow as indicated by its direct-to-consumer footprint through new locations, including agents and its OnlineFX platform. The growth was attributed to the following: (i) Company's owned retail locations, as many locations have matured over time and drove higher volumes, (ii) Opening of an additional airport location which has further expanded the reach to travelers, and

1. Geographic reach of the OnlineFX platform with its continued expansion with the addition of the State of Alabama, making it the 41st State that OnlineFX supports, serving 89% of the U.S. population. Direct-to-consumer revenues represented 34% of the total revenue in the current three-month period, compared to 30% in the same period in 2023.

Wholesale Banknotes revenues increased by $367,113, or 5%, the Company's overall growth was primarily attributed to new customer acquisition in domestic Wholesale Banknotes and the increase in volumes. Wholesale Banknotes revenues represented 45% of total revenue in the current three-month period, compared to 47% in the same period in 2023.

Relative to the three-month period ended October 31, 2023, Banknotes revenue decreased by $4,865,580 or 25%, which coincides with the typical seasonal reduction in tourism in North America. Relative to the most comparable period prior to the pandemic, the three-month period ended January 31, 2020, Banknotes revenue has increased by 60%, reflecting the impact of increased market penetration.

Payments

Revenues in the Payments product line decreased by 3% in the three-month period ended January 31, 2024, compared to the same period in 2023. The growth in new customer acquisition in the United States resulted in a notable growth of 33% for the period, however, there were reduced volumes in Canada that resulted in a 33% revenue decline, causing an overall 3% reduction in this product line. The Company processed 35,618 payment transactions, representing $2.99 billion in volume in the three-month period ended January 31, 2024, this compares to 28,486 transactions on $3.11 billion of volume in the same period in 2023 with the majority of the growth relating to the United States. Payments represented a 21% of total revenue in the current three-month period, compared to 23% in the same period in 2023.

Q1 2024 Report | 8

Management's Discussion and Analysis

(All amounts are expressed in U.S. Dollars unless otherwise noted) For the three-month periods ended January 31, 2024 and 2023

Revenues by Geographic Location

	Three-month	Three-month
	period ended	period ended	Change	Change
	January 31, 2024	January 31, 2023
	$	$	$	%
United States	14,141,020	11,608,266	2,532,754	22%
Canada	3,965,898	5,277,923	(1,312,025)	-25%
Total	18,106,918	16,886,189	1,220,729	7%

Three-month period ended January 31,	Three-month period ended January 31,
2024	2023
22%	31%
United States	United States
Canada	Canada
78%	69%

Revenue by Geographic Location

United States

Revenues grew by 22% during the three-month period ended January 31, 2024 when compared to the same period in 2023, led primarily by $976,257, or 21%, growth in Wholesale Banknotes and $972,608, or 19%, in direct-to-consumer Banknotes, with the remainder of the growth related to Payments of $583,889, or 33%. As outlined above, the growth in Wholesale and Direct-to-consumer Banknotes revenues were largely impacted by new customer acquisition and an increase in transactions as travel to and from the U.S. continued to increase, whereas in the Payments product line the growth was primarily a result of new customer acquisition and activity growth by certain key customers. Direct-to-consumer Banknotes revenue also showed increasing demand for certain exotic currencies during the current period in addition to the natural growth across most of the locations and through the Company's OnlineFX platform. Revenues in the U.S. represented 78% of total revenues by geographic location in the current three-month period, compared to 69% in the same period in 2023.

Canada

Revenues declined by 25% from the same period last year primarily due to a decline in transacted volumes for US Dollars with international clients, however Domestic Banknote revenue maintained levels from the same period last year. Accordingly, revenues in the Banknotes product line declined by $609,143, or 19%, while the Payments product line declined by $702,882, or 33%, compared to the same period in the prior year. The decline in Payments was impacted by reduced transactional volumes for certain key clients in addition to unfavorable foreign exchange movements that impacted trends in transactional volumes. Revenues in Canada represented a 22% share of total revenues by geographic location in the current three-month period, compared to 31% in the same period in 2023.

During the three-month period ended January 31, 2024, the Company's operating expenses increased 12% compared to the same period last year. This 12% increase is higher than the 7% growth in revenues due to slower revenue growth in Canada.

Q1 2024 Report | 9