UAE: Loans based on remittances, split rent payment app in Dubai soon?

Several firms exhibited their products at FinTech Accelerator Programme which showcased the accomplishments of this year’s shortlisted start-ups

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Nasreen Abdulla

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Published: Tue 19 Dec 2023, 6:00 AM

Last updated: Tue 19 Dec 2023, 10:44 PM

A neobank which will give loans to migrant workers based on their remittances is one of the companies that will be funded by the Dubai International Financial Center (DIFC) as part of its FinTech Accelerator Programme.

Founded by Tajikistan national Bobur Murvatov, Planet 9 aims to give small amounts of capital to migrant workers that they can then pay off with their salaries. It was his own experience and observations that prompted Bobur to establish the start up. “Tajikistan alone supplies two million migrants,” he said, speaking to Khaleej Times. “We are a remittance-dependant economy. Most of the families of migrants remain unbanked. It is almost impossible for them to get funding or loans.”

Planet 9 was one of the several companies that exhibited their products on the Investor Day which showcased the accomplishments of this year’s shortlisted start-ups and young professionals. During the event, company founders were given two minutes to pitch their ideas to high ranking officials from DIFC and industry partners. The event also marked the culmination of the DIFC AccelerateHER programme and featured several fireside chats and panel discussions.

Democratising loans

For Bobur the idea was to democratise the ability of families of migrants to get loans and to help migrants in the countries where they work. “Most of the migrants don’t have a credit history,” he said. “They are not eligible for lending or most of the banking products. So I wanted to create a product that would streamline the process of giving migrants loans.”

Planet 9, which is already operational in two countries in Central Asia, is launching a product in the UAE called Send Now Pay Later (SNPL). “We are working closely with exchange houses for this,” he said. “It is a Dh50 million remittances market. There is a lot of potential there.”

Bobur said the process has been made easy for migrants. “The whole process usually takes a minute where by uploading just his Emirates ID, we are able to see his entire financial information,” he said. “Using our AI model, we are able to identify how much money we can lend to him for a short period of three months. It gives us a loan limit which we then offer the migrant.”

He said there has been massive interest from the UAE for the product. “There are eight million migrants in the UAE,” he said. “A customer survey has shown us that many of them fall prey to loan sharks because of their inability to get any kind of loans from banks in the UAE.”

Core programme

According to Mohammad AlBlooshi, Chief Executive Officer of the DIFC Innovation Hub, the accelerator programme has been a core part of the hub since its inception. “We've graduated more than 200 companies from this program since its inception,” he said. “We have several success stories like Sarwa and XYA. The amount of funding that has been raised by this program by the graduates of this program since it started is more than $600 million.”

He further added that this year’s programme has been immensely successful. “This year we are graduating 19 companies,” he said. “There are the startup pitches and then you also have companies exhibiting. This gives an opportunity for investors, corporates or any other governments who are keen on partnering with them to interact and talk to them.”

A second chance

It was an opportunity to give his dream project a second chance that prompted Charlie Berbari to launch his project Ezyrent. An app that allows people to split their yearly rents into monthly installments, Ezyrent is the second iteration of his MBA project. “Back in 2017, we wanted to introduce factoring to the real estate market, which means selling the receivables for someone,” he said. “However, after talking to industry experts, we gave up because the market was not ready for it.”

However, with rents in the UAE rising, Charlie decided to give his dream project another go by pivoting it to meet market demands. “Last year there was an increase in rents of 36%,” he said. “These numbers keep on rising. Increasingly, one-cheque payments have become the norm and people are finding it hard to raise that kind of money. What we want to do is, offer a 12 month payment solution and provide people with rental insurance which will make sure that their rent is paid even if they lose their jobs.”

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