Friday, July 29, 2022

Pakistani Tech Startups Attract Record VC Funding in First Half of 2022

Technology startups in Pakistan received record $249 million funding during January-June 2022, up a whopping 171% from the same period last year. A total of 35 deals closed, up 6% from the first half of 2021. July 2022 saw a maiden investment from Sequoia Capital which is considered among the top venture capital firms headquartered in Silicon Valley, California.  Last year was a banner year for Pakistani startups with $310 million venture capital investments. 

Venture Capital Investments in MENAPT Region 1H/22. Source: Magnitt

Sequoia Capital and Kleiner Perkins co-led $17.6 million seed round in Islamabad-based fintech startup DBank this month. DBank has been founded by Tania Aidrus and Khurram Jamali, both of whom have studied the challenges the unbanked population faces closely at their previous stint at Google, where they worked on payments rails for the company’s Next Billion Users initiative, according to Tech Crunch

Soaring VC Investments in Pakistani Startups. Source: Bloomberg

Pakistani startups set a record in 2021 with $310 million venture capital investments, more than the previous six years combined, according to Bloomberg.  The South Asian nation has seen a wave of investments from many global venture capital firms, including Sequoia Capital and Kleiner Perkins -- early investors in Google and Inc.

Venture Capital Investments in MENAPT Region 1H/22. Source: Magnitt

Pakistan's technology sector is in the midst of an unprecedented boom. It is being fueled by the country's growing human capital and rising investments in technology startups. A tweet by Swedish fund manager Mattias Martinsson captured it well when he wrote, "Have followed Pakistan for 15 years. Can't recall any time time when VC activity was anywhere near we've seen in the last few months. Impact of reforms kicking in?".  New laws have made it easier to create startups and offered greater protection to investors.  Digital infrastructure has expanded with over 100 million smartphones and an equal number of broadband subscriptions. 

With expanding Internet infrastructure and rapidly growing user base, Pakistan is now seeing robust growth in venture money pouring into technology startups. Pakistani startups have already attracted more than $310 million in funding in FY 2021-22, more funds than all the money raised by Pakistani startups in their entire history. A recent example is Kleiner Perkins, a top Silicon Valley venture capital investment firm, that led a series A round of $17 million investment into Pakistani start-up Tajir. The startup operates an online marketplace for small store merchants in Pakistan. The announcement came via a tweet by Mamoon Hamid, a Pakistani-American Managing Partner at Kleiner Perkins who led the investment. Last year, Tajir raised a $1.8 million seed round.  The company's revenue has increased by 10x since its seed round. Another example is Sequoia Capital's first investment in Pakistan this month. 

Pakistan Technology Exports. Source: Arif Habib

Pakistan's technology exports are experiencing rapid growth in double digits over the last decade. Total technology exports jumped 22% to $2.6 billion in fiscal year 2021-22, as reported by Arif Habib Securities

Pakistan University Enrollment Growth. Source: Encyclopedia of Higher Education

The foundation for Pakistan's digital transformation was laid with the higher education reform and telecommunications deregulation and investments starting in the year 2001 on President Musharraf's watch. With a huge increase in higher education funding, Higher Education Commission Chairman Dr. Ata ur Rehman succeeded in establishing 51 new universities during 2002-2008. As a result, university enrollment (which had reached only 275,000  from 1947 to 2003) soared to about 800,000 in 2008. This helped build a significant human capital that drove the IT revolution in Pakistan.      

Please watch the following video presentation for more details on Pakistan's technology startup ecosystem:


Khan said...

Not strange given the ever-growing percentage of Pakistanis within Pakistan that venture into that field whether by choice of education or due to the business opportunities that present itself.

This sector (as is the case of the overall private sector) is less prone to corruption and outside interference from the establishment, thus it makes it a much more interesting, safe and profitable sector to invest in within Pakistan, rather than the ineffective and corrupt public sector or sector where you need direct local involvement, say the mineral (unexplored mostly so far) sector.

Most serious long-term foreign investors would never invest in any public sector in Pakistan as things stand right now.

Mo said...

Do note that all of this happened during the global startup recession.

Z Basha said...

Hindoos are getting funded by their government.. we should also actively seek domestic investment and also Chinese parternships..

M Azhar said...

Rupee depreciation is going to be a concern..Exit routes are choked..and risk vs reward is something to ponder about..

Riaz Haq said...

Azhar: "Rupee depreciation is going to be a concern..Exit routes are choked..and risk vs reward is something to ponder about.."

Top VCs like Sequoia Capital and Kleiner Perkins understand long-term risks and rewards of investing in emerging markets like Pakistan. They know that Pakistan, forecast to be the world's 7th largest consumer market by 2030, is a vast untapped market for them.

Riaz Haq said...

ibex. Pakistan which is also a subsidiary of TRG (The Resource Group) has announced that it will add a new, state-of-the-art, 500 Seat Facility in Karachi to cater to the expansion of its export of business process outsourcing services for some of its largest US-based customers in the retail and financial services sectors.

The facility is expected to be in production by end of the year and will house roughly 800 professionals entirely geared toward the export of IT-enabled services.

“Our largest customers continue to have a positive view of the quality of our human resources, particularly for back-office and call center services from Pakistan”, said Nadeem Elahi Country Manager for ibex. Pakistan, Middle East & North Africa.

He added, “We are extremely excited to continue our growth, particularly in Karachi where we continue to source top-quality people. We plan to hire over 1,000 customer services professionals in the next 3 months in Karachi in both call center, back-office, and chat services geared towards our international customers.”

“I strongly believe that in a difficult time like this for Pakistan, IT and IT enabled services can still continue to grow strongly, and play a major role in the diversification of exports of the country,” said Nadeem.

Nadeem further added, “ ibex. is offering highly attractive packages of an average over PKR 80,000 per month. The customer services industry is a great starter to any young professional’s career as it offers an excellent opportunity to build one’s personal communication and professional skills. Therefore, I strongly encourage everyone seeking a good opportunity to visit our website and apply immediately”.

M Azhar said...

Riaz bhai, What is the USD stock yields in Pakistan like over the last 10-15 years? And what would be your projection for next 10-15 years. For those going in with currency that is all matters. Being 10th largest producer and 7th largest consumer will not be be of any help as we consume more than we produce ! Size matters negatively when it comes to obesity...

Anonymous said...

If investors are coming to Pakistan because it is 7th largest consumer market, then why are investors fleeing India according to your previous article? Is the Indian market not bigger?

Riaz Haq said...

Anon: "If investors are coming to Pakistan because it is 7th largest consumer market, then why are investors fleeing India according to your previous article? Is the Indian market not bigger?"

Investors are looking for other large untapped markets by diversifying away from India and China where they have already invested heavily over the last several decades.

BRICS are losing their luster. Investors are much less bullish on them today than they were a decade ago.

Riaz Haq said...

Ex #RBI Gov R. Rajan: Turning #Muslims Into "2nd Class Citizens" Will Divide #India. Warning against majoritarianism, he cited #SriLanka as an example of what happens when politicians try to deflect a job crisis by targeting minorities. #Modi #Islamophobia

Former Reserve Bank of India Governor Raghuram Rajan on Saturday said India's future lies in strengthening liberal democracy and its institutions as it is essential for achieving economic growth.
Warning against majoritarianism, he said Sri Lanka was an example of what happens when a country's politicians try to deflect a job crisis by targeting minorities.

Speaking at the 5th conclave of All India Professionals Congress, a wing of the Congress party, in Raipur, he said any attempt to turn a large minority into "second class citizens" will divide the country.

Mr Rajan was speaking on the topic 'Why liberal democracy is needed for India's economic development'.

".What is happening to liberal democracy in this country and is it really that necessary for Indian development? ... We absolutely must strengthen it. There is a feeling among some quarters in India today that democracy holds back India ... India needs strong, even authoritarian, leadership with few checks and balances on it to grow and we seem to be drifting in this direction," Mr Rajan said.

"I believe this argument is totally wrong. It's based on an outdated model of development that emphasizes goods and capital, not people and ideas," said the former chief economist of the International Monetary Fund.

The under-performance of the country in terms of economic growth "seems to indicate the path we are going on needs rethinking," he said.

The former RBI governor further said that "our future lies in strengthening our liberal democracy and its institutions, not weakening them, and this is in fact essential for our growth."

Elaborating on why majoritarian authoritarianism must be defeated, he said any attempt to "make second class citizens of a large minority will divide the country and create internal resentment." It will also make the country vulnerable to foreign meddling, Me Rajan added.

Referring to the ongoing crisis in Sri Lanka, he said the island nation was seeing the "consequences when a country's politicians try to deflect from the inability to create jobs by attacking a minority." This does not lead to any good, he said.

Liberalism was not an entire religion and the essence of every major religion was to seek out that which is good in everyone, which, in many ways, was also the essence of liberal democracy, Mr Rajan said.

Claiming that India's slow growth was not just due to the COVID-19 pandemic, Mr Rajan said the country's underperformance predated it.

"Indeed for about a decade, probably since the onset of the global financial crisis, we haven't been doing as well as we could. The key measure of this underperformance is our inability to create the good jobs that our youth need," the former RBI governor said.

Riaz Haq said...

Ex #RBI Gov R. Rajan: Turning #Muslims Into "2nd Class Citizens" Will Divide #India. Warning against majoritarianism, he cited #SriLanka as an example of what happens when politicians try to deflect a job crisis by targeting minorities. #Modi #Islamophobia

Citing the strident protests against the Centre's 'Agniveer' military recruitment scheme, Mr Rajan said it suggested how hungry the youths were for jobs.

"Just a while ago you saw 12.5 million applicants for 35,000 railway jobs. It is particularly worrisome when India has a scarcity of jobs even when so many women are not working outside their homes. India's female labour force participation is among the lowest in G-20 at 20.3 percent as in 2019," he pointed out.

Talking about the "vision of growth" of the current government led by Prime Minister Narendra Modi, he said it centres around the term 'atmanirbhar' or self-reliance.

"Now, to the extent it emphasizes better connectivity, better logistics, better roads and devotes more resources to it, in some way this (atmanirbhar vision) seems the continuation of the past reformed decades. And that's good," he said.

But, the former RBI governor said, in many ways a look at what 'atmanirbhar' is trying to achieve takes one back to an early and failed past where the focus was on physical capital and not human capital, on protection and subsidies and not on liberalization, on choosing favourites to win rather than letting the most capable succeed.

Asserting that there was a misplaced sense of priorities, Mr Rajan said the nation was not spending enough on education, with tragic consequences.

"Many (children) not having been to school for two years are dropping out. Their human capital, which is their and our most important asset in the coming years, is something we are neglecting. We are failing them by not devoting enough resources to remedial education," Mr Rajan said.

Riaz Haq said...

Kaushik Basu
IMF's just-released World Economic Outlook shows, over 3 years, 2020-2, India's annual growth is 2.9%, behind China (4.5%) & low-income country average (3.1%). This is not where India was; its economy has enough strength. This is the price of divisive politics & erosion of trust.

Riaz Haq said...

#Pakistan’s #fintech #startup OneLoad secures $11 million in funding. This #investment round led by Sarmayacar and Shorooq Partners. Other investors include Gates Foundation and IFC.

The company said that "the strategic collaboration with regulated financial partners and banks has led to daily disbursements worth Rs10+ million, which created horizons of accelerated growth for numerous micro-retailers across the country."

OneLoad operates through its 40,000 agents and conducted about $100 million in transactions last year. The company wants to increase daily transaction to one million a day from the current level of up to 400,000, founder and CEO Muhammad Yar Hiraj was quoted as saying by Bloomberg.

Under digital products and payments, OneLoad offers mobile top-ups, internet packages, and media and entertainment services. Under banking access, OneLoad enables money transfers, utility bill payments, deposits and withdrawals for digital wallets, wallet account opening and biometric verification, and government-to-person (G2P) payments – in partnership with banks.

“We are excited to bring new partners to the company like Sarmayacar and Shorooq Partners,” Hiraj was quoted as saying in the PSX notice.

“Working with them brings valuable tech and venture capital expertise to the company and pushes us to continue to innovate and evolve with the regional and global markets. Our vision is to fully digitise the financial needs of the unbanked and the financially excluded masses in Pakistan," he said.

Riaz Haq said...

Pakistan, China aim to boost tech cooperation
Ink Letter of Intent to create world-class technology ecosystem

Shenyang Economic and Technological Development Area (Seda) of China and the Special Technology Zones Authority (STZA) of Pakistan have signed a Letter of Intent (LOI) to boost cooperation in technology sector between the two organisations.

Established in 1988, Seda is a production hub of major biotech and automobile organisations including the BMW Group, Neusoft, Pfizer, NCR and Ikea.

Speaking to a virtual ceremony, Seda’s Director of Management Committee Zhao Yongsheng highlighted the company’s successes, according to a press release issued on Monday.

Seda hosts the largest manufacturing facility of BMW in the world, while 84 Fortune 500 companies from all over the globe are operating in Seda’s hi-tech manufacturing, automotive, research and development areas.

Zhao hailed the strong relationship between China and Pakistan and pledged his organisation’s support and cooperation with the STZA in the areas of innovation, entrepreneurship, human capital development and digital economy through the integration of science, technology and economy.

Speaking on the occasion, STZA Chairman Amer Hashmi stated that due to its rapid growth, Pakistan’s technology sector offered globally competitive opportunities for Chinese partners and investors.

He highlighted that Pakistan had a unique demographic advantage, as almost 64% of its population consisted of youth, and saw great potential in working with Seda through the STZA’s dedicated China Desk to streamline cooperation with the Chinese technology sector.

He praised Pakistan’s Ambassador to China Moinul Haque and the leadership of Seda for enabling cooperation between the STZA and Seda and expressed his support for implementing the shared vision.

Shenyang Municipal People’s Republic Vice Mayor Gao Wei stated that China and Pakistan were strategic partners, with a long history of peaceful cooperation in various development sectors.

He explained that Shenyang was creating hubs for scientific, industrial and technological growth, with special focus on fintech.

He vowed to support cooperation between Seda and the STZA, saying that the technology sector represented a new avenue for potential cooperation between the two friendly nations.

Ambassador Haque highlighted the longstanding ties between the two countries and appreciated the STZA chairman and his team for their efforts to foster the knowledge economy in Pakistan.

He affirmed the commitment of Pakistan’s embassy in China to facilitating the ongoing engagements between the STZA and the technology ecosystem in China and called the LOI a step forward towards strengthening linkages and relationship between the two countries.

He hoped that both sides would increase their cooperation under a joint working group to practically implement the shared vision of creating a world-class technology ecosystem in Pakistan, creating jobs and empowering the youth through the technology-led economic transformation.

Riaz Haq said...

Maersk and SEED Ventures collaborate to improve agricultural exports from Pakistan
July 28, 2022
By Jack Donnelly

Maersk Pakistan Private Limited (Maersk) and SEED Ventures have signed a Memorandum of Understanding (MoU) to launch the Pakistan Agripreneurship Challenge (PAC).

PAC is an Agri-value chain intervention challenge that aims to improve the quality of Pakistan’s agricultural produce and explore new global markets for Pakistan’s agriculture exporters.

In 2020, Pakistan produced 5.6 million metric tons of vegetables, of which the resulting export produce amounted to $4.92 million. In contrast, the Netherlands producing 5.3 million metric tons of vegetables, could export $31 billion worth of produce.

The comparison, Maersk argues, showcases Pakistan is not meeting its export potential for vegetables.

Issues pertaining to storage, transport & distribution are significant roadblocks for the Agri sector, and Maersk claims it is evident that a holistic value chain intervention is required for the post-harvest category.

PAC is an agripreneurship challenge that calls upon Agri ventures, innovators, farmers and agriculture students to participate and develop innovative solutions to solve the post-harvest challenges in Pakistan for vegetable produce.

The shortlisted finalists from the challenge will be given the opportunity to realise their innovative agripreneurship solutions by Maersk and SEED.

The 20 July collaboration signed between SEED Ventures and Maersk aims to identify potential solutions to support Pakistan in meeting its export potential.

Hasan Faraz, Managing Director, Maersk Pakistan, commented: “At Maersk, our purpose is to improve life for all by integrating the world. We are delighted to partner with SEED Ventures and contribute to improving Pakistan’s agricultural sector.”

Riaz Haq said...

The United Arab Emirates is planning to invest $1 billion in Pakistani companies spanning various sectors, state-run news agency WAM reported Friday.

The investments will cover fields including gas, energy infrastructure, renewable energy, health care, biotechnology, agricultural technology, logistics, digital communications, e-commerce and financial services, WAM said.

Riaz Haq said...

StartUpBlink Report 2022: #Startup Ecosystem of #Karachi is ranked at number 291 globally, and shows a negative momentum decreasing -5 spots since 2021. Karachi also ranks at number 1 in #Pakistan, and 10 in #SouthAsia. #technology #Entrepreneurship

Karachi is an ideal place to locate for Ecommerce & Retail, Transportation and Marketing & Sales startups. As the most popular industries in Karachi, there is a sample of 12 Ecommerce & Retail startups in Karachi, 10 Transportation startups in Karachi, and 8 Marketing & Sales startups in Karachi, on the StartupBlink Map.
On the StartupBlink Global Startup Ecosystem Map there is also a sample of 53 startups in Karachi, no accelerators in Karachi, no coworking spaces in Karachi, no organizations in Karachi and no leaders in Karachi.

StartupBlink ranks the startup ecosystems of 100 countries and 1,000 cities. Download our latest Global Ecosystem Report.


Karachi has been ranked among South Asia’s top ten start-up-friendly cities by the startup ecosystem rating website, Startup Blink, in its 2022 report.

Pakistan’s port city has broken India’s monopoly on the list by jumping up four ranks within a year to join the top ten cities.

While the other 9 cities are all in India, Karachi has reportedly surpassed Pakistan’s top city, Lahore, this year, as well as other cities that are considered to have startup-friendly environments.

However, on a global level, Karachi’s ranking has dropped by five places and is now at number 291.

Meanwhile, Lahore fell 48 places to the 305th rank internationally this year. Islamabad was ranked third in Pakistan and dropped one rank to 438th on the global list.

Overall, Pakistan’s ranking as a favorable environment for startups decreased by two places and it stood 76th globally.

It was also ranked second in South Asia and fourth among the Central Asia Regional Economics Corporation (CAREC) countries.

The report detailed that successful start-ups and digitization are of prime importance in Pakistan’s economic development.

Digital entrepreneurship and investment in startups got a boost in Pakistan during the pandemic, and startups were supported by improvements in broadband coverage and digital infrastructure, and a new framework for digital payments. Local IT companies also received tax incentives and exemptions through Special Technology Zones.

Pakistan has come a long way to strengthen its legal framework to promote digitization, according to the report, but still needs clarification on taxes and incentives for local investment.

The country’s climate of political chaos hinders the creation of stable policies and an environment of trust to actually strengthen its startup ecosystem, Start Blinkup detailed. Apart from this, increasing capital demand for emerging startups and the supply of experienced manpower are also causing concern.

To meet these needs, it is necessary for Pakistan to increase the capacity of the startup ecosystem to provide qualified and trained manpower amid the growing demand for capital for emerging start-ups.

Riaz Haq said...

More startups to emerge
Food delivery platform CEO says young entrepreneurs will learn from crisis

Usman Hanif

The current crisis in the startup sector of Pakistan will help new entrepreneurs emerge on account of their learning curve during the economic downturn. The present-day situation is not alarming but is instead an opportunity out of which more startups will emerge.

These views were expressed by Foodpanda Pakistan CEO Muntaqa Peracha while talking about the prospects of startups in an interview with The Express Tribune.

“Since now you have different problems to solve, the best thing about startups is that they disrupt the existing way of thinking. So, in these circumstances, many other companies will come out like they did during Covid,” he said.

The unsettled domestic economic situation is because the global situation is tense, he noted.

“Pakistan is not suffering because we have done something wrong, we are suffering because the whole world is suffering. Our technology industry is still very young and will take time to develop. In every startup, your cycle goes up, then one day you are down and then you pick up. In these lows and highs, we have some organisations that fold, some organisations that get acquired by others, some organisations that will go from strength to strength through consolidation,” he said.

The post-Covid landscape will bring about many changes. The start-up industry will now see more young people, probably many of whom have worked in companies like Airlift, Swvl and other organisations. These budding entrepreneurs have an experience of how to raise money, how to quickly deploy that money, how to scale up very quickly and how to grow rapidly, he added.

The second benefit from the challenges they have faced is that entrepreneurs will have to change the traditional methods of operating a business. The industry as a whole will benefit from this drive towards change. Despite the fact that many startups have shut down operations, “we are sure the industry will bounce back from this and that recovery is only a matter of time.”

This sentiment was echoed by Universal Service Fund (USF) former CEO Parvez Iftikhar, who said that the startup sector will certainly bounce back in due course.

“Such setbacks are normal, in fact good, for any growing endeavour. They provide an opportunity to learn. Growth is never linear, it’s always a zig zag”, he added.

It is evident that economic activity has slowed down both globally and in Pakistan. Investors may also find it challenging to raise funds as a result of the recent economic slowdown in financial markets, said JS Global ICT analyst Waqas Ghani Kukaswadia.

On the flip side, it is also a fact that Pakistan is a large consumer market and there will always be lots of opportunities for entrepreneurs.

“Entrepreneurs will just have to modify their approach when it comes to Pakistan. We have seen this recently with two major startup ventures going south that it doesn’t matter how amazing a concept is or how much capital a business has been able to raise. If the founders of a startup are unable to comprehend how the typical Pakistani market works and how to stay afloat, startups will continue to face difficulties. Only unique concepts and funding arrangements do not ensure a company’s long-term success,” he said.

Startups are a relatively young industry in Pakistan. “We have investors with little or no experience in emerging markets which operate differently than developed markets,” said Foodpanda CEO.

On the flip side, young people who have founded companies and run them have not been exposed to proper mentoring and this has resulted in glaring blindspots. As a consequence, while some people have succeeded, others have not been able to sustain themselves in the long run. Crucially, there may have been more work done on the fundamentals if entrepreneurs starting out in the industry had gained more experience, said Muntaqa Peracha.

Riaz Haq said...

More startups to emerge
Food delivery platform CEO says young entrepreneurs will learn from crisis

Usman Hanif

Startups are a relatively young industry in Pakistan. “We have investors with little or no experience in emerging markets which operate differently than developed markets,” said Foodpanda CEO.

On the flip side, young people who have founded companies and run them have not been exposed to proper mentoring and this has resulted in glaring blindspots. As a consequence, while some people have succeeded, others have not been able to sustain themselves in the long run. Crucially, there may have been more work done on the fundamentals if entrepreneurs starting out in the industry had gained more experience, said Muntaqa Peracha.

In order to draw in more foreign investment, the government and the State Bank have relaxed rules for attracting investment in tech-based startups and are working on regulations that will permit investors to repatriate profits and capital and ease overall corporate operations, Waqas Ghani said.

Pakistani economy will undoubtedly benefit from fostering entrepreneurship in a balanced way. There is a lot of work being done on the digital banking side already and there is definitely hope that entrepreneurship will rise again, Waqas added.

“It was difficult to predict that things will change this rapidly in the startup industry. But now people have experienced and understood the worst-case scenario. At that time, no one had any idea of the worst-case scenario. As they were raising money at the time, from mid-2020 to the first quarter of 2022, everything seemed fine. Now, people know that this is the worst-case scenario and we have to prepare for it while growing at the same time,” Muntaqa Peracha said.

Riaz Haq said...

Non-bank finance firms disbursed over Rs6.14bn loans digitally

Licensed digital lending Non-Bank Finance Companies (NBFCs) have made rapid progress and started to show disruption in Pakistan’s lending landscape and are proving to be significant in furthering the journey of financial inclusion, data shared by the Securities and Exchange Commission of Pakistan (SECP) showed on Friday.

The SECP has licensed six fintech-enabled NBFCs, which have collectively reached out to 365,239 borrowers with disbursement of over Rs6,139 million through 858,998 loans, which signifies that many borrowers have obtained more than one loan from these lenders.

The data released by the SECP shows that the average loans size of these digitally-enabled NBFCs ran­ges from Rs1,000 to Rs80,000 depen­ding upon the nature of business and target market of these entities.

“These are small loans available easily for the borrowers, but since these are digital-based, the borrowers cannot default and ignore the repayment,” said a senior official of the SECP adding that the data of defaulters is shared with the State Bank of Pakistan as a result the defaulter cannot avail any other financial service.

The official added under this lending mode, the small amount request by the borrower is credited into the digital wallet of the borrower within few hours as digital processing of the loan is fast and does not require any guarantee.

Newly licensed digital lending NBFCs include Finja Lending Ser­vices Limited, SeedCred Financial Services Limited, Qisstpay BNPL Limited, Tez Financial Services Limited, Cashew Financial Ser­vices Limited and CreditFix Fina­ncial Services Limited. These NBFCs are providing financial solutions to otherwise unserved and underserved through digital means and include Nano lending, Peer-to-Peer (P2P) Lending and Buy-Now-Pay-Later models etc.

All of these licences have been issued during the last three years to NBFCs that are engaged in digital lending using innovative fintech solutions.

The first fintech-enabled NBFC licence was issued in 2019 and only 55,528 requests were honoured, disbursing Rs495 million, while by the end of 2021, the six licence holders disbursed a total of Rs6.13 billion to 365,239 borrowers.

“This is a solution to the traditional complaint that the banks were not interested in small loans, and the majority of borrowers were those who either did not possessed credit cards or wanted to spend the amount in any sector which does not deal in credit cards,” the official added.

The SECP has said that fresh applications have been received for NBFC licence from investors who intend to engage in fintech based lending.

Anonymous said...

Unfortunately their is no proper guidance in Pakistan , their are hardly any mentors or business consultants in Pakistan who can guide and help these students who are willing to have their own startups .

The reason I think startups are more successful in western countries and in developed countries is because they have mentors and business consultants from whom they can take advices , ideas and suggestions .