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ZoodPay acquires Pakistani consumer loan fintech Tez

ZoodPay, the Swiss-based buy now pay later platform operating in various Middle East and Central Asian markets, has acquired Pakistani consumer loan fintech Tez, it announced in a statement today. Financial details of the transaction were not disclosed, but the statement said it is the first M&A deal in Pakistan’s young fintech space.

Founded in 2016 by Naureen Hyat and Humza Hussain, Tez offers nanoloans to the unbanked and unbanked population across Pakistan through its digital platform. According to its website, it offers personal loans of up to PKR 10,000 ($50), which users can repay in installments. Tez has a fixed one-off fee for these loans, which varies between 10 and 20 percent, depending on the amount of the loan and the customer’s profile.

Backed by Accion, Flourish Ventures (Omidyar Network), Planet N, the startup became the first licensed non-banking financial company (NBFC) in Pakistan in 2018, it said in a statement. To date, it has raised more than $1 million in funding. The Karachi-based fintech also won $100,000 in the Visa Everywhere Initiative for Women in 2019.

Commenting on the acquisition, the co-founders of Tez said: “We started Tez with the ambition to make access to finance as easy for the masses as access to a mobile phone. We are humbled and excited by the confidence shown in our business model by larger regional players and look forward to the next level of development for Tez, where our insights from digital loan origination and risk management can serve as the foundation for consumer-focused delivery. providing credit solutions at scale while creating credit history for the masses.

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ZoodPay, which currently operates in Joran, Iraq, Lebanon, Uzbekistan and Kazakhstan, has raised nearly $50 million from Zain Ventures and Sturgeon Capital. With the acquisition of Tez, ZoodPay would expand its offering to Pakistan.

“The company’s credit strategy is strengthened by three integral elements of digital infrastructure, including: (i) acquisition of consumers and merchants through various distribution channels including its own e-commerce marketplace and network of retailers and partners, (ii) acquisition of rich transactional data. from its inner world of fintech, e-commerce and logistics marketplaces and (iii) Using its proprietary credit scoring algorithms to assess credit risk and provide credit to both consumers and merchants,” the fintech said in a statement.

It is not immediately clear whether ZoodPay plans to launch its BNPL product in Pakistan.

Michael Khoi, CEO of ZoodPay said, “Pakistan is a market brimming with potential given the number of people seeking access to credit facilities. We believe that by combining ZoodPay’s unique ecosystem and experience in frontier markets with Tez’s local know-how, strong team and ecosystem partnerships, we will be able to positively impact the lives of the people of Pakistan and empower them by giving them access to easy, affordable and reliable digital financial services.”

Nadeem Hussain, Chairman, Tez, said, “Pakistan’s startup ecosystem has reached an inflection point. In addition to large-scale acquisitions, acquisitions of local players by international players are beginning to take place. This further validates the global value that Pakistani startups are creating. Planet N was one of the first on the market to invest in startups. Now we see the advantage of the first move.’