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Editor's PickNigerian fintech Moove taps Sukuk market to fund growth

Nigerian fintech Moove taps Sukuk market to fund growth

Mobility fintech start-up Moove has raised US$30 million from its debut Sukuk offering to build the largest electric vehicle (EV) ride-hailing fleet in MENA, a deal underscoring the rising appeal of Sukuk as a fundraising tool for start-ups.


The offering was privately placed and arranged by Franklin Templeton Investments, which structured it based on the Istisnah contract. Istisnah is generally a long-term contract to acquire good by specification or order, where the price is paid in advance or progressively in accordance with the progress of a job.

“This financing is a milestone for Moove – our first Sukuk issuance which showcases our growth and sustainability as a global company. Equally important is that this furthers our mission to build the biggest EV ride-hailing fleet in the region, to drive forward mobility electrification and enable cities to reach their net-zero targets,” commented Ladi Delano, the co-founder and co-CEO of Moove.

Founded in 2020 by Delano along with fellow British-born Nigerian entrepreneur Jide Odunsi, Moove provides revenue-based vehicle financing and financial services to gig workers across ride-hailing, logistics, mass transit, and instant delivery platforms. Over the last two years, over 11 million trips in Moove-finance vehicles were completed.

The African start-up’s business has grown tremendously – last year, it expanded into the UAE, Europe and India with its 100% EV rent-to-buy model. It intends to launch 5,000 compressed natural gas and EVs across Mumbai, Hyderabad and Bangalore in its first year of operations.

Proceeds from the latest capital-raising exercise will be used to scale to 2,000 EVs in the UAE in 2023. Moove estimates that this fleet of EVs will contribute to a reduction of over 5,000 metric tonnes of carbon dioxide emissions per year to help cities like Dubai meet their ambitious net zero targets. It will also introduce its EV charging app, Moove Charge, which was first launched in London in August, in the UAE.

The app allows users to locate charge points, display charge points compatible with their vehicle, show charge point availability in real-time, filter by charge speed, start and stop charging and wallet functionality. Moove has set a goal of ensuring that at least 60% of the vehicles it finances globally are EVs; it is working with partners within the value chain across the MENA region to facilitate this transition in locations where charging infrastructure remains limited.

It is not immediately clear if Moove’s financing schemes comply with Shariah principles, however, it tapping the Islamic debt capital market is a positive signal for Islamic finance as it demonstrates an increasing palatability among smaller firms, particularly early-stage companies, as Sukuk are predominantly utilized by corporates and sovereign entities. UAE-based agritech firm Pure Harvest made headlines in 2021 for being the first start-up to raise Sukuk. More recently, Turkish agritech start-up Tarfin issued Sukuk twice this year.

The transaction, according to Mohieddine Kronfol, the chief investment officer of global Sukuk and MENA fixed income at Franklin Templeton, “further validates the opportunity we have been arguing exists in private credit across the region, combining attractive yields with security and credit control”.

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