In the Middle East and North Africa (MENA) region, the COVID-19 pandemic and the resulting lockdown have put a toll on many sectors, including the startup ecosystem.

According to a research conducted by Wamda and Arabnet, released in May, 71% of the region’s startups said the COVID-19 outbreak has had an negative impact on their business, of which 22% had to suspend operations.

Almost half of the startups surveyed stated they have less than six months’ runway left, with the economic uncertainty and drop in oil price resulting in a sense of hesitancy among the investors community.

In these uncertain times, the community has come together to support one another with new products, as well as discounted and free services.

As a contribution to the fintech startup community, the Fintech News Network has committed to covering a promising startup each week to give them a much deserved spotlight.

This week, we’ll be looking at Rise, a platform delivering financial services to financially underserved migrant workers.

Bringing financial services to low income migrants in the GCC

Dubai-based Kayan Labs is the developer and operator of Rise, a digital platform providing migrant and domestic workers in the Gulf Cooperation Council (GCC) region with financial products and services, as well as educational material.

The platform, accessible mainly through a mobile app, currently offers products including a bank account with no minimum balance or salary, a fast and seamless onboarding process, an accompanying debit card, remittance services, insurance products, unsecured consumer loans, a pay-later product, and a credit fund.

These services are provided in partnership with financial institutions, among which the United Arab Bank, the UAE Exchange, Axa, Carrefour, and Astra Amco, one of the largest hedge funds globally and an early-stage Rise investor. Rise is reportedly in talks with several other financial institutions located in over 10 different countries. More products and services are expected to be added to the platform in the near future.

The platform uses a proprietary artificial intelligence (AI) chatbot to engage with customers in a conversational format on various topics such as financial literacy, planning and account opening.

In addition to financial services, the Rise platform also offers a range of learning certification and career management tools including courses from international and local experts that cover learning and development, health and safety, nutrition and healthy eating and care and nurture.

Rapid growth

Founded in 2016, Kayan Labs says it is building a “one-stop digital banking platform” for underbanked migrant workers to manage all their financial needs. Its mission, it says, is to “democratize access to essential financial services to low-income migrants globally.”

The startup claims its platform has grown by more than 50% month-on-month and brought over US$125 million of annualized income into the financial services sector.

In March, it raised over US$1 million in a funding round led by Middle East Venture Partners (MEVP) in partnership with the Dubai International Financial Centre Fintech fund, Silicon Valley-based 500 Startups, Khwarizmi Ventures and Phoenician Funds.

The startup said it would use the fresh funding to grow its team, develop its financial products and services, and expand across the GCC, starting with Saudi Arabia and Bahrain.

In the long run, Kayan Labs hopes to bring the 25 million+ migrant workers in the GCC under its financial services network. Over the next two years, it intends to reach one million customers, mainly targeting workers from India, the Philippines, Pakistan, and Bangladesh.

Untapped opportunities

The Arab states region is one of the main destination regions globally for migrant workers. According to the International Labour Organization, migrants in the six GCC states account for over 10% of all migrants globally, with Saudi Arabia and the UAE hosting respectively the third and fifth largest migrant populations in the world.

In 2017, migrants in the Arab states remitted over US$124 billion with the UAE and Saudi Arabia ranking second and third globally in terms of remittance outflow.

With its Rise platform, Kayan Labs is far from being the only startup looking to tap into the region’s massive pool of unbanked expats and migrant workers.

Now Money, another UAE-based fintech startup, is also targeting the region’s low-income migrant population with affordable banking and remittance services delivered through a mobile platform. The startup has raised more than US$2 million to date, according to Crunchbase.