In recent news, a fintech startup called Oraan has raised $3 million in Pakistan’s startup seed round which was led by women entrepreneurs. The seed round was led by Zayn Capital and Wavemaker Partners, while Resolution Ventures, i2i Ventures, Hustle Fund, Haitou Global, and Plug and Play were its participants. Claire Diaz-Ortiz, a prominent angel investor and an advisor to the company, also participated in the round.
Founded by Halima Iqbal and Farwah Tapal the startup aims to help women access financial services. According to Halima, it was really difficult opening a basic bank account which took her around three and a half months, and began researching how Pakistani women deal with money hence leading her to generate the vision of Oraan.
According to their research, around seven percent of Pakistani women have a basic bank account and are constantly facing logistical and social barriers. According to Halima Iqbal:
“When a woman goes into a bank, the first question we get asked is ‘why do you even need bank account?,’ especially if you’re a freelancer or micro-entrepreneur or unemployed homemaker. These kinds of restrictions have hindered women from having the kind of financial mobility that they require to be able to contribute equally to the economic growth of the country.”
As of now, Oraan has raised over $4 million in funding total. Moreover, according to the two co-founders, they are the first women entrepreneurs in Pakistan’s fintech space to raise a seed round.
The startup had decided to initiate rotating credit and saving associations (ROSCAs) or committees that contribute money to a pool of members per month which is said to expand its financial services hence becoming a digital bank.
The reason Oraan starting with ROSCAs is because almost everyone they know who had participated had an informal one where 41 percent of the Pakistani population has participated in these ROSCAs where around $5 billion gets rotated through them on an annual basis.
In regards to the long term goal of Oraan, Halima mentioned the following:
“We want to become a full-fledged neobank and very heavily based on community because that’s where we see that women want a sense of belonging. When it comes to financial transactions, that’s one of the things they feel they lack, that sense of belonging.”
As of now, the company has a userbase of more than 10,000 among which 84 percent are women. The userbase experiences over 28 percent growth per month.