Gulf buy now, pay later Tamara company says it raised $100 million

Tamara co-founder and chief operating officer Turki bin Zarah, co-founder and chief product officer Abdul Mohsen Al-Babtain and co-founder and chief executive Abdul Majeed Al-Sikhan pose for a photo at their company’s premises in Riyadh , in Saudi Arabia, August 17, 2022. REUTERS/Ahmed Yosri

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DUBAI, Aug 22 (Reuters) – Gulf buy now, pay later (BNPL) firm Tamara said on Monday it has raised $100 million in a second round of funding from investors including Sanabil Investments, which is owned by the fund. Saudi ruler PIF.

The Series “B” funding would help the Saudi Arabia-based startup expand into new markets and introduce new services and products. He did not specify which markets.

“We believe the region has a different situation today than in the world. The region is thriving with high oil prices,” chief executive Abdulmajeed Alsukhan told Reuters.

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“We want to make sure our customers find the right products that work for them and find amazing deals.”

Tamara, which has over 3 million active buyers, is one of the largest BNPL providers in the Gulf Arab region and competes with companies such as Dubai-based Tabby.

Demand for BNPL, which allows consumers to order and pick up a product without paying immediately, has grown in recent years, driven by an increase in online shopping.

The provider pays the merchant immediately and is reimbursed by the consumer in installments, usually earning revenue only from the transaction fees charged to the merchant.

Tamara was founded in 2020 by Saudi entrepreneurs Abdulmajeed Alsukhan, Turki Bin Zarah and Abdulmohsen Albabtain.

It has so far raised $215 million in capital and has partnered with companies such as IKEA and Saudi retailer Jarir, in addition to e-commerce platforms SHEIN and NAMSHI.

Other investors who participated in its latest round include global investment manager Coatue, Gulf technology investor Shurooq Partners, co-investment vehicle Endeavor Catalyst and existing investor Checkout.com, a global company payment solutions.

Tamara is also in negotiations with local, regional and international lenders for debt financing, a new foray for banks in the region that are still learning about the nascent sector, Alsukhan said.

It expects to reach profitability next year, with plans for a listing in Saudi Arabia in the future, which could include a second listing in other markets such as the UK, he said. .

BNPL’s business model emerged during a period of very low interest rates, but the prospect of sustained interest rate increases could cause trouble for the sector.

“We think the interest rate so far is still manageable,” Alsukhan said. “However, there is no doubt that in such a business, if interest rates go way beyond where they are today, then that is definitely problematic for everyone.”

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Reporting by Hadeel Al Sayegh; Editing by Toby Chopra

Our standards: The Thomson Reuters Trust Principles.

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