ZoodPay, a digital lending platform for e-commerce in the Middle East and Central Asia, has entered Pakistan after acquiring Karachi headquartered Tez Financial Services (Tez).
Backed by investors including Planet N, Flourish Ventures (Omidyar Network) and Accion, Tez became the first fintech in Pakistan to be granted a Non-Bank Financial Company (NBFC) license in 2018. It provides nano-loans to the unbanked and underbanked segments in over 160 cities in Pakistan.
Through this acquisition, ZoodPay is positioning itself as a key new player in the digital lending and fintech industry in Pakistan. “Pakistan is a market brimming with potential given the number of people seeking access to credit facilities,” said Michael Khoi, CEO of ZoodPay. “We’re confident that by combining ZoodPay’s unique ecosystem and experience operating in frontier markets with Tez’s local know-how, strong team and ecosystem partnerships, we’ll be able to positively impact the life of Pakistani people and empower them by giving them access to easy, affordable and reliable digital financial services.”
In the absence of credit histories and credible data, conventional players have been unable to assess risk, deterring their interest in serving the masses – resultantly less than five percent individuals in Pakistan have access to formal credit. Naureen Hyat and Humza Hussain, Co-founders of Tez said that they started Tez with an ambition to make access to finance for the masses as easy as access to a mobile phone.
“We are humbled and thrilled by the confidence shown in our business model by larger regional players and look forward to the next level of development for Tez where our learnings in crafting the digital lending journey and managing risk can serve as a foundation for delivering consumer-centric lending solutions at scale, while creating credit histories for the masses,” they said.
ZoodPay has raised $50 million to date, with participation from leading global and strategic investors including Zain, the leading MENA-based telecom entity and London based VC Fund Sturgeon Capital. The company has launched its Series C round, part of the proceeds of which would be allocated to ZoodPay’s expansion into Pakistan. “With a population of over 230 million people, half of whom are young and digitally-savvy, over 100 million smartphones and 90 percent internet coverage, Pakistan represents a clear high potential market, with a dire need of formal credit,” the company’s press release read.
“The Pakistani startup ecosystem has hit its inflection point,” said Nadeem Hussain, Chairman of Tez. “In addition to sizable fundraises, acquisitions of local players by international players are starting to take place. This further validates the global value Pakistani startups are creating. Planet N was one of the first in the market to invest in startups. We are now seeing the first mover advantage.”
Source: This news is originally published by thenews
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