Tez Financial Services, the first fully digital Non-Bank Microfinance Company (NBMFC) focused on serving the unbanked and underbanked in Pakistan, today announced that it has raised USD$1.1 million in a seed round led by Omidyar Network, the impact investment firm established by Pierre Omidyar, the founder of eBay. Other investors on this round include Accion Venture Lab, the seed-stage investment initiative of global nonprofit Accion; and Planet N. Funds will be deployed to build the company’s credit portfolio, enhance its mobile technology platform, and to meet the regulatory NBMFC requirements.
“Our aim is to become the primary financial service provider for the unbanked and underbanked. Tez delivers a seamless experience for its customers, providing loans in under 15 minutes as opposed to the usual month timeline from local commercial banks. Soon, we will be able to process a life and health insurance claim in similar time,” explains Nadeem Hussain, co-founder and CEO of Tez.
You can learn more about the challenge, opportunity, and impact in this video.
In Pakistan, more than 50 percent of the population is unbanked, according to the World Bank. Many resort to using a variety of informal financial tools to manage their finances, but those can be unreliable, expensive, and inefficient. With more than one-third of the population living below the poverty line, minute fluctuations in cash flow could impair their ability to meet their day-to-day financial needs, such as paying bills or buying groceries. Leveraging the increased penetration of smartphones in the country, Tez aims to integrate the masses into the financial mainstream.
“New technologies, higher smartphone penetration, and falling data costs are fueling a great momentum for financial inclusion in frontier markets such as Pakistan. Tez is leveraging this to push the boundaries of banking in the country with an all-digital offering,” said Kabir Kumar, head of Policy and Ecosystem Building at Omidyar Network. “Tez’s diverse team is also well-positioned to bring about the products and services that really speak to the next generation of consumers in that country.”
Tez aims to reduce the financial vulnerability of over 50 million underserved Pakistanis through a single platform—a smartphone app, driven by artificial intelligence, providing frictionless access to an all-encompassing financial services offering including nano-credit, digital ROSCAs, health and term life insurance, and tailored investments.
“Tez marks our first investment in Pakistan, a country with a significant need for innovative products that can bring its population into the formal financial system,” said Michael Schlein, President and CEO of Accion. “By supporting Tez’s all-digital model, we can help make an important difference for millions of underserved Pakistani families and businesses.”
Tez has integrated with EasyPaisa, UBL Omni, and SimSim as its branchless banking partners, resulting in the largest combined agent network for its customers. It has also partnered with two of the largest insurance companies in Pakistan—EFU Life and Jubilee General—to provide life and health coverage. VentureDive is the technology partner, fostering technological innovation at a global scale, with offices in Pakistan, UAE, and Germany.
Tez is available for download on Google Play and for actively disbursing credit to the masses. Soon, it will be launching additional products that will help further advance financial inclusion in Pakistan.