Local Shariah compliant fintech start-up Tamara, which specializes in buy-now-pay-later e-commerce solutions, has closed the largest seed-funding round in Saudi Arabia amid the Kingdom’s recent push to support fintech and digitalization nationwide.
The seed round worth US$6 million was led by Impact46, an asset manager focused on alternative investments in the Kingdom, and involved local and regional investors including family offices and venture capital firms like Wealth Well, VC company Vision Ventures, Seedra, Khwarizmi, Hala Ventures and Nama Ventures.
Tamara received approval from Saudi Central Bank in October 2020 to test products within the regulatory sandbox, and became the first interest-free buy-now-pay-later platform in the Kingdom. The company plans to expand its operations in Saudi Arabia and branch out to the UAE, both of which will be backed by the seed round.
The company offers Shariah compliant, interest-free installment services to their customers, and its merchant partners include some of the big names in the GCC’s e-commerce arena. “We strongly believe Tamara will be a game-changer for both merchants and customers. It will positively reshape the purchasing power in the market,” Abdulmajeed Alsukhan, CEO and co-founder of Tamara, said.
“The fintech market is expected to reach US$33 billion in transaction value by 2023. We believe that buy-now-pay-later is an untapped area in this huge market,” Abdulaziz Alomran, CEO of Impact46, noted.
According to the Capital Market Authority, the Kingdom’s fintech industry has grown between 2017 and 2019, with an increased rate of 18% per year in transaction value and raising US$20 billion at the end of 2019. IFN understands that fintech companies operating within the Kingdom, while not obligated by any official law, typically ensure their products and services are Shariah compliant, in line with the Saudi Vision 2030’s objective of being a leader in the global Islamic finance industry.