Agel, the first Islamic FinTech startup in Egypt, has recently concluded a pre-seed funding round for a significant amount in the seven-digit range. The company aims to provide digital, cashless, and Sharia-compliant financing options for Egypt’s Micro, Small, and Medium Enterprises (MSMEs).
The investment was spearheaded by several venture capital firms focused on the MENA region, including Plus Venture Capital (+VC), Seedstars International Ventures, and Flat6labs. Notable participations also came from SEEDRA Ventures, Banque Misr, and prominent angel investors. The exact figures of the funding round have not been disclosed at this time.
Speaking on the funding, Chief Investment Officer of Flat6Labs, Dina El-Shenoufy said the company is happy to invest in Agel to support their mission towards revolutionizing the Fintech space for MSMEs in Egypt with innovative solutions catering to their cash flow management and working capital needs.
We’re confident that the team has the capabilities to scale and expand its operations to further cater to the unique needs of its merchants and suppliers. We’re looking forward to continuing supporting Agel in its journey towards increasing financial inclusion in Egypt and beyond”, said
Dina El-Shenoufy
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The Islamic FinTech startup, is dedicated to revolutionizing conventional financial services by offering alternative financing solutions to cater to the needs of Micro, Small, and Medium Enterprises (MSMEs) in the country.
The company’s primary objective is to provide tailored, digital, cashless, and Sharia-compliant financing products that align with Islamic principles. One of Agel’s key offerings is Murabaha, a financing model based on cost-plus, ensuring compliance with Islamic principles. Through its innovative approach, Agel aims to empower MSMEs in Egypt and contribute to their growth and financial inclusion.
Commenting on their recent round, Agel CEO, Abdelrahman Saeed, “We are proud to be backed by prominent regional investors, who offer not only financial support but also invaluable industry knowledge and experience. Their confidence in our business model will enable us to reach our objectives and take our operations to the next level.”
Agel’s plan to become a licensed non-banking financial institution
The newly raised funds will be deployed to grow Agel into a licensed non-banking financial institution, accelerate advanced product development to cater to its rapidly increasing customer base, and expand its footprints to the major cities in Egypt.
Agel will also launch a merchant co-branded banking card service in partnership with Abu Dhabi Islamic Bank (ADIB) and other value-added services. The company’s growth aligns with Egypt’s 2030 vision of financial inclusion and supports the United Nations’ Sustainable Development Goals (UN Global, SDG).
Managing Partner at +VC, Hasan Haider, is impressed with this growth trajectory, noting that his company is excited to have invested in Agel, which has great potential for growth:
While limited financing options remain a constraint to MSMEs in Egypt, Agel is a powerful, innovative solution for quick and easy Sharia-compliant payment options. As Abdelrahman and his team work to deepen their platform capabilities and expand their services to major cities in Egypt, we look forward to supporting them as they cement their position as pioneers in the Islamic FinTech space.
Hasan Haider
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General Partner at Seedstars International Ventures, Patricia Sosrdojojo noted that the Islamic-styled fintech is fulfilling a critical need. She said that despite the fintech startup boom in Egypt, a lack of access to finance is still recognized as a key obstacle to the MSMEs in the country.
In fact, loans to MSMEs account for only 6% of the total loan portfolio of Egyptian banks, well below the 10-30% required and below the MENA’s (8%). By digitizing the lending and procurement process for informal SMEs, Agel is bringing efficiency and increasing accessibility in this market. We are happy to partner with the entire Agel’s team as they bring the complementary and needed skills to execute such a plan successfully”.
Patricia Sosrdojojo
Agel’s strategy centers around empowering merchants by providing them with the necessary financing to procure goods and supplies for their trade through a credit system facilitated by its industry-focused network of suppliers. This approach not only supports merchants in accessing the necessary resources but also aids suppliers in boosting their sales by enabling them to offer goods on credit.
Additionally, Agel’s comprehensive app streamlines and simplifies the management of commercial transactions, making the process effortless for both merchants and suppliers. By fostering seamless interactions and facilitating credit-based transactions, Agel aims to foster growth and enhance business opportunities for all parties involved in the ecosystem.
In its first year of operations, Agel tapped into Egypt’s annual $15 billion textiles industry, establishing the largest suppliers’ fashion-focused network. The company plans to diversify its offerings to other lucrative industries, contributing to $85 billion annually.
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