Credit cards are hard to come by in Egypt. Only 4.8 million credit cards, or less than 5% of Egypt’s 104 million people, are available to be used to service that population, according to the Central Bank of Egypt.
Due to wage reductions, an increase in unemployment and underemployment, and a general slowdown in the economy, the COVID-19 lockdown’s impact on the Egyptian economy led to an increase in the demand for credit facilities.
Individuals and enterprises nationwide are unable to take advantage of trading possibilities and realize the full economic potential of the country as a result of this demand and a constrained supply.
The IMF expects Egypt to overtake Nigeria as the second-largest Arab and African economy by the end of 2022, which might jeopardize those estimates.
In order to address this, Blnk offers customers access to credit at the moment of sale. A combined pre-seed and seed funding round of $32 million was raised for the startup; this includes $23.7 million in equity and debt financing, as well as $8.3 million in the form of securitized bond issuance.
Leading the $12.5 equity round were Egypt’s Sawari Ventures and Abu Dhabi’s Emirates International Investment Company (EIIC), together with a number of well-known local and foreign angel investors. The National Bank of Egypt and Banque du Caire underwrote the $8.3 million securitised bond sale, and many top local banks provided the debt finance totaling $11.2 million.
Amr Sultan and Tarek Elsheikh founded Blnk in October 2021, and it has created a digital lending platform that enables businesses of all kinds to rapidly underwrite and finance the purchases of their consumers at the point of sale.
Consumers can access these finances in 3 minutes with just a national identity card, and in 6 to 36 months, they can pay in instalments for a variety of goods and services, including electronics, furniture, and automobile services.
The fintech intends to use this money to finance its quickly expanding customer base, support the further development of its artificial intelligence-powered lending infrastructure, and quicken the pace of financial inclusion in underserved regions across the nation.
By utilizing its extensive network of merchant branches located all over Egypt, Blnk claims to have disbursed more than $20 million in loans since its launch the previous year. Not only do customers gain from Blnk, but retailers also increase their profits thanks to the transaction commission that Blnk offers.
Blnk’s goal of giving Egyptian consumers inclusive access to financing is a step in the right direction for a developing economy and should hopefully support further growth and development.
Amr Sultan, co-founder and CEO of Blnk, discussed the company’s plans for the additional funding by saying, “Our mission is to make it simpler for more Egyptians to buy the goods and services they want by offering inclusive and convenient consumer credit at the point of sale. We are thrilled to have the support of such an outstanding group of investors at this early stage of our journey. We are confident that, with their help, we can advance financial inclusion in Egypt and the larger Middle East and North Africa region.
“We are convinced that the Egyptian market and its startup ecosystem present a compelling opportunity for regional and international investors, and we are committed to identifying and investing in value-accretive businesses,” said Joseph Iskander, Head of Investment at EIIC. We are excited to collaborate with the team at Blnk to accomplish their objectives as we are glad to cooperate with them to promote financial inclusion and economic growth in Egypt.