Dubai-based “buy now, pay later” platform Tabby has raised USD 50 million in debt financing from San Francisco-based Partners for Growth, the company announced in a statement. The startup said that this is the largest debt facility raised by a fintech firm in the Middle East & North Africa. It had previously raised a relatively small amount of debt as part of its USD 23 million Series A in December 2020.
Started in 2019, Tabby offers interest-free BNPL services in the United Arab Emirates and Saudi Arabia. It partners with retailers to enable their customer base to defer paying for their purchases for up to 30 days or pay in four equal installments for their online and in-store purchases. Tabby’s solution directly integrates with merchants’ online checkout or POS systems.
With this debt facility, Tabby will fund the purchases of its customers. “Partners for Growth’s investment will bolster Tabby’s capitalization to expand its lending capacity and support the company’s growth. The vision is to grow the size of the facility as Tabby’s underlying sales scale over time,” said the startup in a statement.
Hosam Arab, the co-founder and CEO of Tabby, said, “We’re delighted to partner with a globally reputed private debt institution like PFG. As our transaction volumes and merchant numbers have continued to surpass all our expectations, it was essential for us to partner with an organization that would support our current and long-term growth.”
Max Penel, investment director at Partners for Growth, said, “Tabby is one of the fastest-growing companies in the MENA region, and it has an attractive market opportunity ahead. We are excited to support the Tabby team and provide financing that can enable Tabby to scale its platform, harnessing the continuous growth of the BNPL sector, both regionally and globally.”
With the rise in the number of fintechs and other startups extending credit to their customers (in different ways) across the region, they’re opting to raise venture debt, which is cheaper than raising money by giving up equity. Trella, Trukker, and Tamara are some of the regional startups that have raised a significant amount of money in debt over the last six months.
This article was originally published on MENAbytes.