Egypt's Raseedi Acquires Kashat To Expand Fintech Offerings

Raseedi, a fintech company serving Egypt’s underbanked population, has acquired Egypt-based fintech Kashat in an equity deal to expand its financial product offerings.

The acquisition includes Kashat’s subsidiary, Pharos Microfinance S.A.E., which will allow Raseedi to introduce instant cash loans to its users.   

Kashat, founded in 2018 by Karim Nour and Sumair Farooqui, provides small loans to financially excluded individuals. Its subsidiary, Pharos Microfinance, licensed by the Financial Regulatory Authority (FRA), offers nanoloans in Egypt with short-term tenures of one to three months. Its services target solo entrepreneurs and small businesses, helping them manage cash flow cycles and expand their operations with minimal documentation. 

Founded in 2018 by Ahmed Atalla and Samuel Samy, Raseedi helps users reduce call costs while integrating digital financial services such as mobile top-ups and bill payments. With the acquisition of Pharos Microfinance, Raseedi’s platform will enable users to apply for loans of up to EGP3,000 (US$59.46), disbursed within minutes after a credit scoring process. These loans will be deposited directly into users’ mobile wallets. 

Raseedi has developed a behavior-based credit scoring algorithm to assess the creditworthiness of users without prior financial histories. This technology will enhance the accessibility and efficiency of Pharos Microfinance’s services. 

The acquisition supports Raseedi’s goal of expanding its digital financial solutions beyond Egypt. After establishing a strong presence in the country, the company plans to expand into other African and Asian markets, pending regulatory approvals. 

Inc. Arabia spoke to Atalla – Raseedi’s co-founder and CEO – about the challenges and opportunities the company faces in new markets, the role of its credit scoring system in promoting financial inclusion, and how digital lending can empower small industries. 

Atalla highlighted the initial hurdle of user acquisition in new markets, especially since Raseedi's offering is unique and the first of its kind in the region. “Since our product is fully digital with zero on-ground operations, our biggest challenge usually is acquiring the initial user base especially since our offering is unique and first of its kind in the region," he said. "We have overcome this in Egypt, but definitely, with new markets, this shall be the first challenge. We're currently eyeing Morocco as a next stop, given the large underbanked population and the similar market dynamics to Egypt.” 

In markets with low fintech adoption, Atalla noted that building trust is crucial, while explaining that Raseedi’s approach is grounded in familiarity and ease of use. “This is our main edge, as users start using our app to make their daily calls for cost optimization, and eventually doing their online payments and top-ups through us, they build trust with our app," Atalla explained. "Our average users use the app 200 times every single month, with our top users using it 1000 times/month. A very sticky approach that has been built on trust over the past years which will pave the road to providing the financing product through Kashat and its subsidiary Pharos Microfinance." 

Atalla also touched on the impact of nanoloans on small industries, particularly for skilled laborers and entrepreneurs. “Imagine getting millions of Egyptians with the technical skills and expertise to start small businesses being able to grow and support the previously informal industries," he said. He also told us that Raseedi’s nanoloans will support a wide range of industries, from helping tradespeople purchase tools to enabling individuals to start small clothing businesses or maintain taxis. 

Atalla went on to discuss how Raseedi’s credit scoring system offers a solution to underbanked populations, creating opportunities for financial inclusion. “For the first time, underbanked masses with no credit history who were unable to receive financing to start their small endeavors will be able to achieve this with us,” he said. The system relies on alternative data, enabling people without prior financial credit histories to access loans. "Think millions of underbanked Egyptians who are very worthy of receiving financing, and are willing to start a new chapter with a small business or job," he said. "Our offering will act as their first entry into the formal banking system as they start building a credit history with us for other financing opportunities and products offered by other financial institutions in the market." 

Pictured on image: (from left to right) Pharos Holding's Elwy Taymour with Raseedi's Ahmed Atalla. Image courtesy Raseedi.