Paymob, which enables merchants to accept digital payments online and in-store, has raised $50 million in Series B funding.
New York-based Kora Capital and London-based Clay Point were involved in the round.
British International Investment, which was formerly the CDC Group, is one of the new investors. The Series A investors doubled down.
The round brings the total funding of Paymob to over $65 million.
Paymob works with merchants of all sizes. Islam Shawky claims to be the largest in Egypt because of his payment infrastructure. There are different payment options such as bank cards, mobile wallet, and consumer finance. Offline merchants can use Paymob's POS solution to accept in-store card payments.
Shawky, who launched the Cairo-based fintech in 2015, explained that they want to help the merchants grow.
Egypt’s Paymob closes $18.5M Series A to expand payments services across MENA
Over 35,000 merchants used Paymob's payment gateways last year. The merchant number has tripled to over 100,000, and now includes the likes of Virgin, Virgin Mobile, and Decathlon. Shawky says Paymob will reach a million small businesses in the next couple of years.
Egypt has over 3 million small and medium enterprises. A new product launch in partnership with Mastercard is behind Paymob's strategy to reach that figure.
The cost of getting a point-of-sale machine can be very high for small merchants. They will need to process large volumes over a long period to recover the expense.
Merchants can use the Tap-on-phone product to process payments with their phones by using the Paymob-powered app.
The CEO said that this is a game-changer for face-to-face transactions because it opens the market up for them. The product will be rolled out for new merchants while acting as a supplement to traditional point of sale devices, which will allow Paymob to stay ahead of competition. Similar companies in other regions across Africa include CinetPay.
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Paymob's extensive product suite was what attracted Kora Management. The founder of Paymob says that the firm is in the process of expanding at scale in the offline merchant acquiring and online payment gateway space as Egypt and the Middle East transition from being primarily cash-led to a digital heavy mode of transactions.
Paymob is no exception, as it has praised the Central Bank of Egypt's financial inclusion initiatives. Shawky says that the issuance of over 20 million Meeza cards and 25 million wallet and giving companies licenses to distribute and operate POS devices are some of the reasons why Paymob has witnessed remarkable growth.
Paymob reported a total payment volume of $5 billion in 2020, but it couldn't tell you what it looks like right now. In other metrics shared by the company, it said its monthly volumes grew 4x year-on-year. Paymob had carried out over 120 million transactions as of 2020.
Paymob could grow faster by the end of the year. 100,000 merchants from the South Asian country of Egypt will be added within the next two years, according to a statement.
Paymob claims to serve merchants in other markets, but it is yet to open its doors in Palestine and Kenya. The company has its sights set on a few markets in the Middle East and North Africa, as the growth financing provides the required funds to launch in them. Paymob will try to get more market share in Egypt as well as introduce more offerings in its product suite, including expense management software and provision of working capital.
"Paymob shares our mission and ambition of advancement of digital payments adoption, and it has made impressive strides in supporting the growth and success of underserved small businesses." said the director at co-lead investor PayPal.
The CVC firm is second in Africa after South African open finance startup Stitch. Despite a global slowdown in venture capital (yet to reflect in Africa as much), PayPal's participation continues the trend from last year that saw global investors make their first set of deals, particularly in fintech, a sector that contributed 60% of the total VC funding.
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