Haball Raises $52M to Expand Islamic Finance Operations

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Woman holding US dollar banknotes in an illustration taken on May 30, 2022. — Reuters

KARACHI: Haball, a fintech company based in Pakistan, announced on Tuesday that it has secured $52 million to enhance its shariah-compliant supply chain financing and payment services.

The funding round, led by Zayn VC and Meezan Bank, comprises $5 million in equity and $47 million in strategic financing. This investment is aimed at supporting the company’s expansion efforts within Pakistan, according to an official statement.

The capital will also facilitate Haball’s entry into the Middle Eastern market, with plans to start operations in Saudi Arabia later this year, the company added.

“The supply chain finance sector in Pakistan is still in its infancy but is projected to exceed a value of $9 billion, largely due to the significant financing gap that small and medium-sized enterprises (SMEs) in the country face—where less than 5% can secure financing from commercial banks,” the statement revealed.

Islamic banking and finance are experiencing rapid growth in Pakistan, the second most populous Muslim nation globally, with the total assets in this sector reaching 9,689 billion Pakistani rupees (approximately $34.54 billion) by the end of June 2024, as reported in the State Bank of Pakistan’s Quarterly Islamic Banking Bulletin.

The market shares of Islamic banking assets and deposits within the overall banking sector stood at 18.8% and 22.7%, respectively.

The central bank aims to achieve a target of 30% for overall banking assets and deposits to be under Islamic banking by the end of the current fiscal year, as outlined in its strategic plans for 2023-2028.

According to Haball, the company provides shariah-compliant financing to nearly 8,000 SMEs and multinational corporations, in addition to offering digital invoicing, payment collection, and tax compliance services.

“Haball has processed payments exceeding $3 billion and has disbursed over $110 million in financing, streamlining supply chains across Pakistan,” stated Omer bin Ahsan, the firm’s founder and CEO.

Islamic finance prohibits interest payments and speculative transactions, and it can only be utilized for investments in shariah-compliant assets or portfolios.