Egypt financial super app, Khazna secures $38M to cater for the underbanked, unbanked
Khazna, an Egyptian financial super app has secured $38 million in Series A debt and equity funding from the US-based Quona Capital, and the UAE-based Global Ventures led round to extend its service to Egypt’s unbanked and underbanked population.
Other investors in the round include Austria’s Speedinvest, Saudi Arabia’s Khawarizmi Ventures, the United States’ Accion Venture Lab, Arab Bank’s AB Accelerator, and Egypt’s Algebra Ventures, Disruptech, and CVentures.
This now takes the total funding received from the company since its inception to $47 millionfirst strategic institutional investment.
“We’re quite proud of our investments.” It’s a mix of global FinTech heavyweights like Quona Capital and Speedinvest, as well as some of the country’s most powerful national and private banks.” Omar Saleh, the chief executive, and co-founder of Khazna said.
Omar Selah, Ahmed Wagueeh, and Fatimah El Shenawy founded the company in 2019 to provide basic banking and various financial services to 150,000 active users, focusing on middle and lower-income earners who lack access to formal financial services, such as salary advances, buy now pay later (BNPL), and bill payment.
Its first product, introduced in 2020, was an earned salary access offering. This solution, dubbed Khazna HR, allows partner firms to provide financial advances to their employees in part or whole.
“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. One of the main motivators for everyone working at Khazna is social impact, so it’s extending and offering banking and financial services that are usually available only for high-income brackets and provide those through a very simple mobile-based experience to the masses.” Saleh explained.
Monica Brand Engel, co-founder and managing partner at Quona mentioned Khazna’s growth and prospects as the reasons for Quona’s investment in the company. “In just two years, Khazna has scaled and monetized quickly and is already a market leader in the push for financial inclusion for the 35 million underbanked in Egypt.”
Khazna has benefited from the Central Bank of Egypt’s newly introduced regulations to help increase financial inclusion rates and accelerate the country’s digital transformation. Last week the bank launched a national Instant Payment Network and InstaPay mobile application that will allow customers to carry out electronic transfers instantly.
Saleh expressed optimism over the CBE’s policy that targets the unbanked adult Egyptians.
“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.” Saleh said.
Its undisclosed seed funding in March 2020 was led by Algebra Ventures and Accion Venture Lab. In April 2020, Abu Dhabi-based Shorooq Partners invested $50,000, and in August of the same year, Village Capital provided $45,000 in non-equity assistance.
Khazna plans to expand its product offerings based on user priorities and may expand in the long term into markets where there is a large underbanked population, high smartphone usage, and regulator support.
“We’d love to see Khazna grow to 5 to 10 million active users here in Egypt. Currently, we’re at 150,000. At the end of the year, we’ll be at a million. So we have a few more years fully focused on Egypt,” he said.