Egypt-based Financial Super App Khazna raises $38M Series A to improve the financial well-being of 35M+ underbanked Egyptians with convenient, customer-centric, and technology-driven services.
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Khazna, a Cairo-based financial Super App has secured $38M in its latest mix of debt and equity financing. The equity part of this Series A round was led by impact investor Quona Capital with the participation of Speedinvest, Nclude, Khawarizmi Ventures, Algebra Ventures, Accion Venture Lab, Disruptech, AB Accelerator by Arab Bank, and CVentures, among others. On the other hand, the company’s debt financing was provided by Lendable, with Arab Bank Egypt facilitating the transaction as the assigned Security Agent.
Khazna launched in 2020 with an Earned Wage Access product that has since grown into the multi-product offering available today. Khazna’s super app caters to 50% of Egyptians who are active smartphone users yet lack access to formal financial services. Khazna currently offers General Purpose Credit, Buy Now Pay Later (BNPL), and Bill Payment. The company’s vision is to digitize cash transactions across Egypt, in response to the Central Bank of Egypt’s recent push for financial inclusion and a “less-cash” framework.
The fintech industry was in overdrive last year across all Emerging Venture Markets, observing a 56% YoY growth in total transactions to cross the $2B mark in capital investment, as recorded in our FinTech 2022 Venture Investment Report. In Egypt, the Fintech space led deal flow activity last year, accounting for 17% of total transactions in 2021. While Egypt-based FinTechs recording 67% more transactions in 2021 than FY 2020, funding in the sector crossed $60M for the first time. Over 50% of this capital was driven by sizable investments in alternative digital payment platforms including Dopay, digital payment provider PayMob, as well as ‘Save Your Money Pay Later’ platform Sympl.
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“The unprecedented evolution of Egypt’s nascent fintech industry is a testament to the significant efforts by the Central Bank of Egypt towards financial inclusion and a less-cash society. We are aligned with CBE’s vision and Khazna at its core believes that world-class financial services should be available to all. We are combining cutting-edge technology and relentless user obsession to build the best experience for our users,” said Omar Saleh, Khazna’s co-founder and CEO. “We continue to experience exponential growth in network effects created by our 150K+ active users, our partners, and Egypt’s largest merchants.”
Khazna represents Quona Capital’s second investment in Egypt. “In just two years, Khazna has scaled and monetized quickly and is already a market leader in the push for financial inclusion for the 35M underbanked in Egypt,” said Monica Brand Engel, co-founder and Managing Partner at Quona. “Empowering consumers and micro-businesses with Khazna’s convenient, user-centric, and 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.”
“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,” said Suresh Samuel, Lendable's Deputy Chief Investment Officer. “As Lendable continues to grow our presence providing scalable debt financing to fintechs in Egypt, we are excited to support Khazna’s work in providing increased access to financial services for the underserved in Egypt.”
The round comes as Khazna ramps up its efforts to replace informal cash-driven alternatives across Egypt, pairing a digital native solution with an innovative business model. Arab Bank has been appointed as the Security Agent to enable Khazna’s debt facility from Lendable. “Supporting Khazna was a natural step for Arab Bank as a strategic investor to facilitate the company’s growth,” said Ahmed Ismail Hassan, Country Manager at Arab Bank – Egypt.
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