In a significant development marking a milestone for Pakistan’s burgeoning startup scene, Turkish fintech powerhouse Papara is poised to acquire SadaPay, a prominent player in Pakistan’s fintech landscape. While specific details of the acquisition are yet to be disclosed, reports suggest that the transaction, structured as an all-stock deal, is valued between $30 to $50 million.
What sets this acquisition apart is Papara’s commitment to inject an additional $10 million investment into SadaPay, further cementing its position as a formidable challenger in the banking sector. Against the backdrop of a global funding crunch, this infusion of capital represents a crucial vote of confidence not only in the startup ecosystem but also in Pakistan’s vibrant fintech sector.
While final negotiations are underway, insiders reveal that the State Bank of Pakistan (SBP) was approached several months ago to seek regulatory approval for the acquisition, which is anticipated to receive official sanction imminently.
This impending transaction challenges the scepticism surrounding the profitability of Electronic Money Institutions (EMIs) in Pakistan, given the perceived limitations in revenue generation avenues. Previous instances of EMIs withdrawing from the market following State Bank approval have raised doubts about the viability of this business model in the Pakistani context.
Papara, having successfully implemented a similar model in its home country, now sets its sights on acquiring 100% ownership of SadaPay. Importantly, internal documents pertaining to the deal affirm that the acquisition will not alter the corporate or operational framework of SadaPay Pakistan Limited. The existing management team, including CEO Brandon Timinsky, will continue to lead the company, ensuring continuity in strategic direction.
Post-acquisition, Papara plans to inject an immediate $10 million into SadaPay’s operations in Pakistan, earmarked for technological enhancements and market expansion initiatives. This strategic move is poised to bolster SadaPay’s ambition to venture into the remittance business, catering to expatriate Pakistanis in key markets such as the UK and Saudi Arabia.
The impending acquisition underscores the growing confidence in Pakistan’s fintech sector and positions SadaPay as a pivotal player in the country’s digital banking revolution. As the regulatory landscape evolves and investment flows into innovative ventures, the collaboration between Papara and SadaPay signals a new era of growth and opportunity in Pakistan’s dynamic startup ecosystem.
