Egypt-based fintech app Khazna announced raising $38 million in a Series A round, a mix of equity and debt. Quona Capital led the equity investment with the participation of Speedinvest, Nclude, Khawarizmi Ventures, Algebra Ventures, Accion Venture Lab, Disruptech, AB Accelerator by Arab Bank, and CVentures, among others, while Lendable provided the debt financing.
In a country where two out of every three individuals have limited or no access to formal financial services, even though 50% of Egypt’s 100 million population are active smartphone users, startups are rising to assist banks in deepening financial services to the underbanked and unbanked across the region. One of such is Khazna — a self-described “financial super app” that is attempting to replace informal cash-driven alternatives across Egypt by pairing a digital native solution with an innovative business model.
About Khazna
Khazna Super App offers easy to use, technology-driven financial services to Egypt’s underserved consumers and micro-businesses. Khazna was founded in 2020 by Omar Saleh, Ahmed Wagueeh, Fatma El Shenawy to provide basic banking and various financial services focusing on middle and lower-income earners.
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The company started with an Earned Wage Access product that allows partner employers to offer cash advances to their employees, either in part or in full, and has since grown into the multi-product offering available today since it previously secured an undisclosed seed round, which from some deduction falls between $8-9 million. Khazna has added offerings such as buy now, pay later, bill payments and a prepaid debit card. This is similar to Telda and Sympl, which also operates in the region.
“We are much more of a super app than a digital bank because we have, in addition to the financial services, launched multiple non-financial services as well on the app,” said CEO Saleh when asked whether Khazna is yet another digital bank.
“How the products are designed, and the merchants that we are connected to is all in line with the needs and the interests of low to middle-income Egyptian users.”
Khazna’s commitment to following the Central Bank of Egypt’s (CBE) push for financial inclusion and a “less-cash” framework is one of the super app journey’s highlights. That’s not all, though. According to its CEO, the company will try to leverage the bank’s infrastructure for some of its planned services.
“We are aligned with CBE’s vision, and Khazna, at its core, believes that world-class financial services should be available to all. They’re launching multiple initiatives that we are part of, including the instant payment network where we will offer some services like instant payments through this infrastructure,” he said.
Khazna’s BNPL service is available in 1,000 merchant stores across the country, said Saleh. He also said the platform has 150,000 users across all its products.
Increasing Access To Financial Service for the Underserved in Egypt
The super app plans to expand its product and user base to stay ahead of the competition with the new funding. As revealed by the CEO, the next goal for the company is to increase the number of Egyptians that use its financial super app to 1 million by the end of 2022.
Speaking on the investment, Monica Brand Engel, Quona co-founder and managing partner, mentioned in a statement —
“In just two years, Khazna has scaled and monetised quickly and is already a market leader in pushing for financial inclusion for the 35 million underbanked in Egypt. Empowering consumers and micro-businesses with Khazna’s convenient, user-centric, and the transparent financial super app can enable millions across Egypt to gain greater control over their financial lives. Quona is incredibly excited about Khazna’s roadmap to be the category-leading digital super app for inclusive finance in Egypt.”
Suresh Samuel, Deputy Chief Investment Officer at Lendable, also commented that —
“We have been following the Khazna team since its launch in Egypt and have seen the business gain clear traction resulting in a fast scaling product offering.”
“As Lendable continues to grow our presence providing scalable debt financing to fintech in Egypt, we are excited to support Khazna’s work in providing increased access to financial services for the underserved in Egypt,” he added.