UAE-based fintech startup, Tabby, has announced the closure of its operations in Egypt, just five months after launching its buy now, pay later (BNPL) service in the country.
The decision is in response to Egypt's tough macroeconomic environment caused by the falling value of the Egyptian pound, which has seen a 53% loss in its value since March 2020.
In a statement, Hosam Arab, founder and CEO of tabby, expressed his company's continued belief in the Egyptian market and the potential of its consumer lending sector. He added that the company will shift its focus towards sustaining its growth in its core markets in the UAE, Saudi Arabia, Bahrain, and Kuwait.
Tabby, which raised $58 million in a Series C funding round last month, has a post-funding valuation of $600 million and will continue to invest in growing its team to support its core markets.
Despite the challenging economic environment, the consumer lending sector has grown recently in Egypt, with a turnover of EGP 17bn (~$554 million) in 2021, up from EGP 8.4bn (~274 million) in the previous year. Furthermore, the BNPL sector in Egypt is expected to grow from $1bn in 2022 to $5.8 billion by 2028, according to a report by Research and Markets.
Although the company has decided to pause its commercial operations in Egypt, it said it will continue to assess opportunities to re-engage in the future.