Fawry, a prominent payments company based in Egypt, is set to embark on an exciting venture by launching its own digital bank. This strategic move came shortly after Fawry expressed its intentions to obtain a digital bank license from the Central Bank of Egypt. In this article, we delve into the details of Fawry’s plans to provide a range of financial services and the significance of this development for the Egyptian market.
According to local media reports, Fawry aims to transform its online payment portal, known as myFawry, into a comprehensive digital bank. The envisioned digital bank will offer a wide range of financial services, including payments, consumer lending, savings, and investments. Fawry intends to finalize its decision by the end of this year or early next year, as stated by Hassan Abdelgelil, the company’s head of investor relations.
It is worth noting that the Central Bank of Egypt (CBE) recently established regulations pertaining to the licensing, registration, monitoring, and supervision of digital banks. Fawry is not the only company expressing interest in acquiring a digital banking license. Other notable players in the Egyptian market, such as eFinance and Opay, have also exhibited their intent to venture into digital banking. The fintech industry in Egypt is expected to witness substantial growth in the upcoming years, with market volume projected to reach $10 billion by 2027. The number of fintech companies in the country has already increased five-fold, from 32 in 2017 to 177 in 2022.
Fawry, renowned as Egypt’s largest e-payment platform, foresees the establishment of a digital bank as an opportunity to expand its service offerings and diversify its revenue streams. The company’s subsidiary, Fawry Microfinance, has already received preliminary approvals from the Financial Regulatory Authority to include SME financing in its portfolio. Furthermore, Fawry has partnered with UAE-based voice-calling app Botim to facilitate bill payments and remittances for Egyptian workers residing in the UAE. This strategic move aims to tap into Egypt’s growing remittance market. It is worth mentioning that Flutterwave, a Nigerian fintech unicorn, is also eyeing a share of the Egyptian remittances market.
In terms of financial performance, Fawry reported impressive results in its H1 2023 financial report. The company recorded a total revenue of EGP 1.4 billion ($45.3 million) in the first half of the year, marking a significant 42.4% increase compared to the previous year. Fawry’s adjusted net profit witnessed a remarkable year-on-year rise of 290.4%, reaching EGP 327.9 million ($10.6 million), with a net profit margin of 22.7%. Additionally, Fawry processed 67.6 million transactions on its mobile wallet, amounting to EGP 80.5 million ($2.6 million) in transaction value, reflecting 73.9% and 107.7% year-on-year growth, respectively.
Fawry’s venture into digital banking signifies a significant milestone not only for the company but also for the Egyptian financial landscape. By expanding its services and leveraging the digital platform, Fawry aims to cater to diverse segments of the Egyptian market and seize new opportunities for growth. The launch of a digital bank aligns with Fawry’s vision of providing convenient and innovative financial solutions to its customers.
