Much of the population of Egypt does not have access to traditional banking, forcing many to rely on cash transactions and unofficial lending. Khazna, a FinTech starting in 2019, is facing this issue by offering financial services tailored to low and medium -income workers. The company provides solutions such as salaries, digital payments and small businesses to help employees and contractors have access to very necessary financial services.
Khazna has recently secured $ 16 million in Primary B funding, bringing its total funding to over $ 63 million. The investment will support its expansion plans as it is preparing to apply for a digital banking license in Egypt and expand to Saudi Arabia.
When we covered Fintech in 2022, it just set a series of $ 38 million with over 150,000 customers on its products. Today, Khazna has increased its users base to over 500,000 people. This number is half what is aimed at the end of 2022, according to what Saleh CEO shared at the time.
The company focuses on employees who earn three times less than Egypt’s minimum salary, providing them with affordable financial tools. About 100,000 users receive their payroll through Khazna, allowing the company to incorporate financial services, such as loans and insurance directly into their payroll accounts.
For the other 400,000 users, Khazna offers lending services, helping employees and retirees to access access credit. Saleh explained that this product did the FinTech break-even last month.
“What we have done for the last two and a half years was to focus on our basic product, which is a credit offer to payroll and retirement recipients and also unsecured loans to concert workers,” said co -founder and CEO Omar Saleh in Techcrunch. “This is the most profitable and basic product on our trip and doing it right was very important because it helped us hit profitability.”
On the way to become a digital bank
Khazna provides other services such as bill payments, buy now, payment later, medical insurance and property rental product. But with the integration of both payroll and lending, it is strategically moving towards becoming a complete digital bank for the inadequate Egyptian communities.
But one thing is missing: Unlike traditional banks, Khazna does not have access to customer deposits, making loan funding costly. So far, Khazna has been based on wholesale debt funding (USD) and the Egyptian pound (EGP) for the financing of lending businesses.
To reduce borrowing costs and offer more affordable loans, Khazna is now working to obtain a deposit permit in Egypt. This license would allow the start to accept customer deposits, allowing it to reduce the cost of funds.
“The biggest change of game here is for us to have access to user deposits. There is a huge opportunity for us to capture part of this market as well as in a way that will make our funding costs much more attractive than it is today, and In the end, this would put us in a very different position, “he noted.
Khazna is targeting mid -2026 to obtain banking license from Egypt’s Central Bank, which presented its regulatory framework for digital banks in July 2024.
As the six -year -old Fintech begins with this process, it at the same time sets sights in Saudi Arabia, where there is a growing demand for consumer funding solutions. Unlike BNPL players such as Tabby and Tamara, who focus on the short -term BNPL credit, Khazna hopes to differentiate medium -term credit products such as wage access (EWA), lending lending and lending and credit based on retirement -based retirement .
Extension plans including a non-limited ipo
Another reason why Khazna prioritizes Saudi Arabia is its strong connection to Egypt, Saleh notes. With nearly three million Egyptians living in Saudi Arabia, Egypt-Saudi’s remittance corridor is one of the largest, presenting the opportunity to provide cross-border financial services, combining foreign currency-based bids (FX).
In addition to market size and product adaptation, Saudi Arabian capital markets are also a guide to Khazna’s decision, according to Saleh. Tadawul, the Saudi Stock Exchange in Saudi Arabia, is one of the region’s wetter and retail stock markets, launching several public registrations in the last two years.
For this reason, Khazna plans to have 40-50% of its activities from Saudi Arabia over the next four years, making it eligible for public registration in Tadawul. For early stadium investors that supported the company for four to five years, Saleh says this is providing a clear path to a high -value outlet.
Certainly, Khazna will finance this expansion with the recently increased growth capital. However, the macroeconomic challenges in Egypt in the last two years have had their hand in the structure of this pre-surgery round.
Between 2022 and 2023, Egypt faced currencies and economic volatility, making raising capital more difficult for newly established businesses and businesses. The overall slowdown in the flow of transactions reflected this, as investors adopted a careful approach to Egyptian startups. However, in 2024 it brought a significant shift, with over $ 50 billion in direct foreign investment (FDI) to flow to Egypt after economic reforms and a more flexible exchange rate. As a result, investor confidence has returned, bringing refreshed interest from world and regional investors.
As a result, Khazna welcomed the participation of young and existing investors, including global investors such as Quona and Speedinvest, as well as Regional Investment Enterprises such as Aljazira Capital Anb seeds (managed by Anb capital), Disruptech, ICU Ventures, Khwarizmi Ventures and Sanad Fund for MSME.
