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NayaPay is a two-sided payments platform. It offers consumers a way to make a broad range of payments by smartphone, as well as providing them with a debit card. And it offers small businesses a way to accept digital payments, whether online or at the point of sale.
“During my time in China, I saw the way services like WeChat and AliPay evolved,” Lahani explains. “But in Pakistan there is nothing comparable, even though this is a country that is very underbanked.”
Indeed. For many people – both consumers and businesses – Pakistan remains a cash economy. Some 50 million adults are unbanked – getting on for a quarter of the population – and certain groups are particularly poorly served. For example, just a third of Pakistani women have a bank account. Students and the self-employed are also routinely ignored by the banking sector.
Amongst small businesses, meanwhile, Lakhani points out that 90% of Pakistani enterprises deal almost entirely in cash. The country has just 60,000 point of sale terminals that enable customers to pay by card in person. Online banking penetration rates are very low.
Against this backdrop, Lakhani saw an opportunity to build a profitable new business that would confront this exclusion. “We are empowering young Pakistani adults starting their financial journey, from students stepping into adulthood to freelancers and entrepreneurs taking an active role in managing their finances,” he says. “Our tools are intended to give business owners visibility of their cash flows, pay suppliers and grow sales; our goal is to enable them to focus on growth while we take care of the rest.”
The first stage of the launch of NayaPay is nearing completion, with 50,000 consumers already using a beta version of the app that the company launched last year. Via a NayaPay wallet on their phone, they can pay bills, manage their finances and pay in shops that accept the technology. The app is chat-based, in the style of WeChat and similar services, and consumers are also issued with a Visa debit card they can use for payments.
Stage two of the launch over the coming months will see NayaPay focus on the other side of the transaction, with the roll-out of its services for small businesses. The company promises a universal payment acceptance platform, enabling small business owners to accept payments in any way they see fit, whether in-person or online.
Lakhani argues that as well as solving a practical problem around digital payments, NayaPay will bring broader benefits, enabling both consumers and small businesses to get a much stronger grip on their finances. Rather than having to deal in cash, they’ll be able to review and manage their finances on-screen. Over time, the platform expects to introduce a series of tools to help with this.
The long-term ambition is for NayaPay to become a “super-app” for Pakistanis’ financial needs. Lakahni expects to be able to offer savings, investment and lending services, particularly as data flows in about users and provides a means with which to understand their needs and circumstances. He also plans to host other providers’ apps on NayaPay, extending the range of services that the platform offers. “Our goal is to continue to innovate and build functionality to become a part of people’s daily lives, for the rest of their lives,” he says.
That vision has excited investors. The funding round announced today is led by Zayn Capital, the global fund manager MSA Novo and the early-stage venture capital investor Graph Ventures. Singapore-based Saison Capital, Waleed Saigol’s Maple Leaf Capital and Warren Hogarth, CEO of Empower Finance, have also participated in the round, alongside the sponsors of the Lakson Group – a Pakistani conglomerate with interests in media, telecom, industrials and financial services.
Lakhani plans to deploy the cash to support customer acquisition and support, as NayaPay works towards its target of onboarding 5 million consumers and businesses. The funding will also help the company to accelerate its roll-out of its small business proposition – and to build a machine learning team as NayaPay focuses on analytics to help it introduce new services.