The top fintech savings platform in Saudi Arabia, Hakbah, has announced the success of its $5.1 million Series A fundraising.
VentureSouq, a global venture capital firm with a portfolio based in the Middle East and North Africa, led the funding round. New investors Bunat Ventures and M-Capital, as well as longtime investors Global Ventures and Aditum Investment Management Ltd., also took part.
One of the MENA region’s fastest-growing startups, Hakbah serves the $216 billion savings market in Saudi Arabia. In addition to striking several high-profile deals with companies like Flynas, the national low-cost airline in Saudi Arabia and the Middle East, the company this year recorded an 18x increase in total savings under management and a 4x increase in revenue. It also boasts a customer base of over 500,000 users, 70% of whom are between the ages of 21 and 35.
The Series A funding round proceeds will be utilized to advance machine learning and the company’s readily integrable savings engine, with a particular emphasis on product development. Ring-fenced capital will be used to draw in and develop the best talent in the area and solidify Hakbah’s position as the top savings platform. Additionally, the business plans to soon enter two regional markets through a strategic alliance or partnership.
The digitization of traditional group savings (Jameya) for the purpose of meeting financial needs is part of Hakbah’s social savings platform, which improves financial inclusion and fully integrates with any banking system in less than a week. Savings groups are a common and traditional savings behavior, with members in over 60 countries worldwide. Users of Hakbah divide the money pool, which is divided among them on a rotating basis, and prioritize their overall needs over time. This encourages purposeful saving, improves conventional saving behavior, and raises financial literacy. Additionally, the business plans to soon enter two regional markets through a strategic alliance or partnership.
The Middle East savings dilemma is addressed by Hakbah’s model. Savings are vital to the nation’s Financial Sector Development Program and a major strategic goal of “Saudi Vision 2030.” Just 1.6% of Saudi Arabian households have emergency savings, and 70% of people lack such funds.
Naif AbuSaida, the founder of Hakbah, said: “We are grateful and happy to announce our Series A funding round and to enjoy the trust of both our new and existing investors. This demonstrates our success in delivering Hakbah’s strategic goals and will help to accelerate our growth plans and financial stability for individuals.
“We’re working to build a savings platform via which individuals can save easily, quickly, collectively, and with impact—on our mission to double the individuals’ savings ratio in Saudi Arabia by 2025. With the sizeable savings groups and household savings markets and 60% of the population under 30, there is a significant opportunity for efficient, digital solutions to transform Saudi Arabia’s savings habits.
The support from esteemed organisations such as the Saudi Central Bank, the Digital Government Authority, Monsha’at, the National Technology Development Programme, and Saudi Fintech is vital in our pursuit of growth and innovation. By leveraging machine learning and customer behaviours, we aim to develop cutting-edge savings products that cater to the unique needs of our customers.”
