Pakistan-based fintech platform, NayaPay, has raised $13 million in a seed round to roll out its multi-service messaging and payment app, and to build payment acceptance and financial management tools for businesses in the South Asian country.
The CEO and founder of the super-app said that it allows people in Pakistan to send and receive money, split bills and make payments from their phones. The virtual and physical Visa cards are linked to the NayaPay wallet and allow users to make POS payments and businesses to accept payments.
In Pakistan, only 1% of $4 trillion of payments are done electronically, and that's where the digital payment revolution is taking place. There are 220 million people in this country. Only one in three women hold a bank account, and millions of adults remain unbanked, which is why NayaPay's goal is even bigger. Pakistan's youth and freelancer communities are locked out by traditional banks. According to a World Bank report, 100 million people are unbanked in Pakistan.
The first target market for us is students and freelancers, who are among the most underbanked population. They can't open bank accounts because they don't have a source of income. They are considered very high risk by the bank compliance departments, but they are seen as a group with the highest lifetime value.
The round was led by a London-based investment firm. It had the participation of Saison Capital, Waleed Saigol, Maple Leaf Capital, CEO Empower Finance, and sponsors of the Lakson Group. Tag raised $12 million last year, but the seed round is the largest in the South Asian market.
We are very bullish on Pakistan. Pakistan's fintechs have the advantage of learning from peers and placing better informed strategic bets. We were impressed by the completeness of the vision of the founding team at NayaPay, and their differentiated platform-based strategy, first focused on servicing the needs of underbanked consumers and SMBs with specific use cases and building out from there.
The image is from NayaPay.
With a proven ability to execute on the ground, the founder has an impressive track record of building and scaling businesses in Pakistan, including the country's largest fiber broadband service.
During his visits to China, Lakhani came up with the idea to launch a payments app. Cybernet, the company he helped build from scratch, is now the largest Internet and Data Communication Network Service Provider.
He says he was inspired by the ease in use of the Chinese super apps and decided to replicate the model with his new payment service.
After completing his undergraduate and graduate studies in the US, Lakhani went back to Pakistan to build Cybernet, which he did with the help of his friends.
The E-Money Institution license from the State Bank of Pakistan is one of the authorizations obtained by NayaPay.
He says that it will impact other sectors like e- commerce as more people use the NayaPay wallet to make online transactions.
There is a massive demand for online shopping in Pakistan because it is growing at a fast pace. He said that restaurants that used to depend mostly on a POS terminal are now requiring payment gateway for online sales.
They plan to introduce other digital financial services in the future.
They will be able to invest in money market funds, stock trading and buying other digital assets on the platform.
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