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Egyptian financial super app Khazna raises $38 million from Quona Capital and Lendable – TechCrunch

By on March 31, 2022 0

In a country where 50% of its 100 million people are active smartphone users, two out of three people have little or no access to formal financial services in Egypt.

As banks do their best to deepen financial services to underbanked and unbanked people across the North African country, startups are also playing their part. One such provider is Cairo-based Khazna, a self-proclaimed “super financial app” that raised $38 million in Series A debt and equity.. The company has received a total of $47 million since its creation.

The company, founded by Omar Selah, Ahmed Wagueeh, Fatimah El Shenawy and Omar Salah in 2019, provides basic banking services and various financial services focusing on middle and low incomes.

Its entry point product was an earned wage access product launched in 2020. Dubbed Khazna HR, this product allows partner employers to offer cash advances to their employees, in part or in full.

Access to earned wages is attracting interest from investors in different emerging markets such as India, Nigeria and Indonesia, where startups are helping employees – white-collar and blue-collar – to access their salaries in real time . It’s part of a game of financial inclusion that frees these consumers from the stress of running out of money or taking money from predatory lenders..

Some of these providers, such as Refyne, Earnipay, salary and NowPay, another Egyptian platform, offers it as a standalone service. But for Khazna it is fair one of the many services sold to consumers. Since securing an undisclosed seed round, which by some deductions is between $8 million and $9 million, Khazna has added offers such as buy now, pay later, bill payments and a prepaid debit card. Similar providers in Egypt include Telda and Sympl.

“We are much more of a super app than a digital bank because we have, Besides to financial services, launched various non-financial services also on the app,” CEO Selah said, responding to questions about whether Khazna is yet another digital bank.

“How the products are designed and the merchants we are connected to all match the needs and interests of low to middle income Egyptian users. »

Khazna’s BNPL service is available at 1,000 merchant stores nationwide, the chief executive said. He also said the platform has 150,000 users across all of its products. Khazna plans to launch Additional products before the end of the year; this product expansion and user growth is what Selah highlights when asked how Khazna stays ahead of the competition.

Meanwhile, one of the highlights of Khazna’s journey is his commitment to following the efforts of the Central Bank of Egypt (CBE) towards financial inclusion and a “less liquid” framework. But that’s not all. According to its chief executive, the startup will seek to leverage the bank’s infrastructure for certain services in its pipeline.

“We are aligned with the vision of CBE and Khazna, at its heart, believes that world-class financial services should be accessible to all. They launch various initiatives that we are part of, including the instant payment network where we will offer certain services like instant payments through this infrastructure. »

The Egyptian startup has a team of 70 people, whose management team includes former executives from WorldRemit, Uber, Jumia and Match Group. The startup’s next goal, Selah says, is to increase the number of Egyptians using its super financial app to 1 million by the end of 2022..

It will build on this recent financing led by Capital Quona run on that front. Khazna is the impact investor’s second check in an Egyptian startup after B2B retail e-commerce company Capiter.

The round received participation from Nclude (the venture capital fund launched by three Egyptian banks and Dubai-based Global Ventures), Speedinvest, Khawarizmi Ventures, Algebra Ventures, Accion Venture Lab and Disruptech, among others.

“In fair two years, Khazna scaled and monetized quickly and is already a market leader in promoting financial inclusion for the 35 million underbanked people in Egypt,” said Monica Brand Engel, co-founder and managing partner of Quona, in a statement.

“Empowering consumers and micro-businesses with Khazna’s practical, user-centric and seamless financial super app can give millions of people across Egypt greater control of their financial lives. quona is incredibly excited about Khazna’s roadmap to becoming the best-in-class digital super app for inclusive finance in Egypt.

Lendable, an emerging markets lender, provided debt financing for the company. Arab Bank Egypt has been said having facilitated the debt transaction between the two parties as a “security agent”.