Pakistani startup Abhi aims to become the largest financial wellness platform
Abhi, a Karachi-based Fintech startup, has raised $2M for their Seed round, which was led by VEF and Sarmayacar and featured participation from a mix of international and local investors including, Village Global, i2i Ventures, and Zayn Capital.
Abhi will use the funds to develop its platform’s technology and increase hiring.
The Pakistan-based startup called ‘Abhi’ (Urdu word that means ‘right now’) intends to provide employee salary advances based on accrued wages as most employees in Pakistan live paycheck to paycheck. The startup, co-founded by Omair Ansari and Ali Ladubhai, plans to transform the way people spend their money, aims to become the first and largest financial wellness platform in Pakistan.
“We believe financial wellness and access to credit are basic human rights, which we aim to bring to all our customers. Our goal is to digitize consumer credit, address pain points in the manual payments process and be there when consumers need us most. Your wage is your right, and we want you to have access to it Abhi” said Omair Ansari, Abhi co-founder.
The financial inclusion in Pakistan increased from 21% of adults pre-pandemic to 25% in late 2020, driven entirely by mobile money adoption, according to a recent survey by Kantar Public and Karandaaz Pakistan.
“Less than 2 million people in Pakistan have access to formal credit,” says Ali Ladhubhai. “We saw the need for an early wage access product that could allow them to access alternate digital finance together with a knowledge center to educate them about using personal finance responsibly.”
Ladubhai said that “This is just the beginning for” the startup which has “plans to provide a range of digital financial services to allow for customers to conduct all financial transactions from a single financial app.”
Dave Nangle, Partner at VEF, commented “We are very excited to partner with Omair, Ali and the Abhi Team. This investment allows VEF to continue our mission of improving the financial well-being of the average Pakistani. The traditional pay cycle has tied up employees’ earned income for as long as we can remember, forcing workers to turn to overdraft, payday loans and other punishing products.”
Nangle added that “Companies talk about ‘Digital Transformation’ all the time but modernizing the pay cycle is the most fundamental transformation a company can make to its relationship with employees. It is a great scale product, a win for all involved and the cornerstone for a much broader employee financial wellness play.”
Sarmayacar’s General Partner, Dr. Bernhard Klemen added “The annual salaries of the urban employed labor force across 100,000 public and private companies in Pakistan are estimated to be over $65 billion, yet official reports suggest that formal lending channels account for the credit of just over $3 billion only, with millions of Pakistanis accessing informal channels at egregious rates. Sarmayacar believes in Abhi’s vision and is delighted to back Omair and Ali in transforming the way Pakistanis access credit and over time build the region’s leading finance wellness platform.”
Misbah Naqvi, co-founder and general partner of i2i Ventures, mentioned “Access to earned wages should be a right of all employees and we are delighted to support Omair and Ali as they launch a pioneering business in Pakistan. Fintech is an exciting space in Pakistan right now and we feel that the Abhi team has the right experience and is well-positioned to leverage this market opportunity to build Pakistan’s first financial wellness platform and broaden financial access in one of the largest untapped markets in the world.”
Ben Casnocha, co-founder and partner at Village Global, said: “Financial inclusion has lots of room for growth in Pakistan, since many individuals are not able to access basic banking services due to their lack of financial stability. Because of this we think Pakistan’s market is ripe for disruption and we believe Abhi’s model is the best way to do it. We’re excited to join them on this journey.”