Some of the more interesting stories in international fintech this week come from the Central Asian nation of Kazakhstan. Solva, a Kazakhstani fintech that provides working capital solutions, has secured an investment of $20 million. The funds will help Solva grow from a microfinancier into a SME-based bank. The transition is expected to be completed this year.
The investment came courtesy of the Sawiris family of the Egyptian Orascom Group and Zhang Capital Partners (ZCP). ZCP is an early-stage technology investor that makes direct investments in B2B/enterprise SaaS, digital marketplace, and fintech infrastructure companies.
Solva co-founder Boris Batine said that the capital will help drive the company’s “regional strategy and expansion plans.” Batine added that the transition from a nonbanking financial institution to a fully-licensed bank will be that much easier with “a well-known and respected international investor” such as Zhang Capital Partners (ZCP) at Solva’s side.
Founded in 2017, Solva is the first neobank for both MSMEs and consumers in Central Asia. The firm offers revolving credit lines up to $20,000; installment loans up to $30,000 with terms ranging from one to five years; and short-term working capital solutions up to $5,000 for as many as 120 days.
Solva has issued microloans worth 66 billion KZT ($145 million) to more than 50,000 small business owners throughout Kazakhstan. The company notes that 70% of the loans in its portfolio – more than $85 million – go to female-led businesses. Solva is also a supporter of the UN Global Compact corporate responsibility initiative. The initiative establishes principles involving human rights, labor, environment, and anti-corruption principles.
Financial literacy is also a priority for the company. Solva has endorsed the Kazakhstan government’s Program for Improving Financial Literacy for 2020-2024 initiative. Approximately 7,000 Kazakhstanis have participated in the Solva’s financial literacy programs over the past two years.
In other Kazazkstan-based fintech news, Kaspi.kz is on track to become the first company from the Republic of Kazakhstan to list in the U.S. A major Kazakhstani fintech, Kaspi.kz offers a payments platform that enables consumers to make payments to merchants and service providers, as well as P2P fund transfers.
The company also has a marketplace platform that connects on- and offline merchants with consumers, and a fintech platform that offers BNPL services. Kaspi.kz is the parent company of the Kasp.kz Super App, which has become among the most widely recognized financial services app in Kazakhstan. Kaspi.kz reports 13.5 million average monthly users on the app, with 65% of them using the app on a daily basis.
That said, Kaspi.kz has objectives beyond both its native Kazakhstan and Ukraine and Azerbaijan, where the company also does business. The firm’s prospectus mentions a goal of growing to 100 million users. And Kaspi.kz co-founder and CEO Mikheil Lomtadze underscored the ability of the listing to stimulate growth.
“Being in Kazakhstan, we do not have the luxury of being able to rely on private equity or venture capital money to fund our operations and growth,” Lomtadze said. “With a U.S. listing, we believe Kaspi.kz can reach a larger and more diverse investor base that will enjoy being with us for the next stage of our development.”
Kaspi.kz is already listed on the London Stock Exchange, where the company boasts a valuation of almost $19 billion.
Here is our look at fintech innovation around the world.
Sub-Saharan Africa
- Nigerian expense management platform Bujeti raised $2 million in seed funding.
- Cameroon-based fintech Koree secured $200,000 in pre-seed funding.
- Nigeria-based social payment app Scrim agreed to be acquired by Canadian payment solutions provider Chimoney.
Central and Eastern Europe
- Lithuanian regtech AMLYZE announced a strategic partnership with Berlin’s TransactionLink.
- eToro forged a partnership with Munich, Germany’s Tangany, a specialist in cryptocurrency custodial services.
- Moldova-based fintech platform Fagura has launched operations in Romania.
Middle East and Northern Africa
- ADIB-Egypt launched its personalized, Sharia-compliant private banking services for high net worth clients.
- The Jerusalem Post looked at how fintechs are partnering with Israel’s National Bureau for Counter-Terror Financing (NBCTF) to deal with terrorism financing.
- Saudi Arabian fintech savings platform Hakbah teamed up with MENA-based open banking platform Tarabut.
Central and Southern Asia
- Embedded finance platform Neem and Mastercard have partnered to leverage embedded finance to promote financial wellness in Pakistan.
- A working capital solutions provider based in Kazakhstan, Solva, raised $20 million to fuel its transition into an SME-based bank.
- The Pakistan Observer noted that fintech will help drive Islamic banking to $4 trillion by 2026.
- JazzCash, a fintech platform based in Pakistan, has announced a strategic partnership with Pakistan-based venture capital firm Fatima Gobi Ventures (FGV).
Latin America and the Caribbean
- Uruguayan fintech Prex announced plans to reach five million Latin American users of its virtual wallet over the next two years.
- Caribbean-based e-payments platform WiPay launched operations in Colombia.
- Colaboramed, the fintech arm of AMOL, Agenda Medica online, has locked in $1 million in funding at a valuation of $8.8 million.
Asia-Pacific
- Singapore-based business lending platform Funding Societies secured an investment from Khazanah Nasional and CGC Digital. The amount of the investment was not disclosed.
- Nikkei Asia looked at the competition between fintech startups and financial services incumbents in the Philippines.
- China’s central bank ruled that Ant Group’s Alipay has no controller, a key step toward restoring the company’s IPO plans.
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