• Saudi Arabia-based buy now pay later (BNPL) startup, Tamara, has raised a $340 million Series C round at a valuation of over $1 billion.
• The round was co-led by SNB Capital and Sanabil Investments, with participation from Shorooq Partners, Pinnacle Capital, and Impulse, in addition to existing investors such as Coatue, Endeavor Catalyst and Checkout.com.
• Tamara was founded in 2020 by Abdulmajeed Alsukhan, Turki Bin Zarah, and Abdulmohsen Albabtain.
• Last month, Tamara also secured an additional $250 million in debt financing.

Press release

 Tamara, the leading fintech platform to shop, pay and bank in Saudi Arabia and the wider GCC region, has achieved the historic milestone of becoming the Kingdom’s first homegrown fintech unicorn by securing $340 million in a Series C equity funding round. 

This round was co-led by SNB Capital, the leading regional financial institution, and Sanabil Investments, a wholly owned company by the Public Investment Fund (PIF) with participation from Shorooq Partners, Pinnacle Capital, Impulse and others, joining existing investors such as Coatue, Endeavor Catalyst and Checkout.com. It is also among the largest investments in a fintech company in the region, following on from last month when the Company secured additional debt financing to upsize its warehouse facility to up to $400 million, led by Goldman Sachs and Shorooq Partners. With this transaction, Tamara will have raised a total of $500 million in equity funding, and well above $400M in debt financing since its inception in late 2020. 

Tamara operates in KSA, where it is headquartered, UAE and Kuwait and has more than 10 million users, over 30,000 partner merchants and reported six times annual run rate revenue growth in less than two years. The Company was established in late 2020 and founded by three Saudi co-founders, Abdulmajeed Alsukhan, Turki Bin Zarah and Abdulmohsen Al Babtain. It was also one of the first companies to be granted a permit to provide BNPL services from the Saudi Central Bank (SAMA).

Abdulmajeed Alsukhan, Co-founder, and CEO of Tamara said: “Saudi Arabia deserves its place on the world stage for financial technology. Just as Tamara was created by local entrepreneurs, nurtured by a supportive local ecosystem and market regulators, we stand here today, humbled and hungry, ready for our own leapfrog moment. This achievement is a testament to the ecosystem, to our incredible team, investors, and the collaborative spirit that makes this region a great place for talent to flourish. As we set our sights on becoming the next big giant in shopping, payments and banking we remain ever grateful for the significant opportunity in this underpenetrated and underserved banking and financial services landscape. Furthermore, The Saudi Central Bank (SAMA) has been instrumental in creating an enabling environment for Saudi companies like Tamara to grow and innovate in the Saudi fintech sector.”

A spokesperson from SNB Capital stated, “Leading on the Series C raise for Tamara through SNB Capital's Close-Ended Fintech Fund aligns with one of our objectives to invest in single target companies achieving long-term capital appreciation. Fintech is one of the core investment sectors in SNB Capital’s strategic portfolio and is aligned with the Kingdom’s Vision 2030 objective of supporting fintech entrepreneurs at every stage of their development.  As a Saudi unicorn Tamara requires significant funding options which SNB Capital is ideally positioned to deliver, and backing the development of the fintech infrastructure which will support further growth.”

A spokesperson from Sanabil Investments added, “Our continued backing and investment in Tamara underscores our unwavering confidence in Tamara’s remarkable growth trajectory. At Sanabil, one of our missions is to empower visionary ideas, turning them into impactful realities. We constantly seek innovations that address pressing market demands while ensuring scalability and sustainability. In Tamara, we have discovered a team with the potential to revolutionize financial services, not only within Saudi Arabia but on a regional scale.”

Recently, Tamara has taken the decision to remove late payment fees, highlighting its dedication to offering financial solutions that align with Sharia principles, customer centricity and transparency. Tamara consistently strives to uphold a socially responsible business ethos, and this change is a testament to its ongoing commitment to boosting customer satisfaction, ensuring a seamless, compliant and reliable financial journey for everyone. 

The Company’s offering makes it a commerce enabler to its partners through the surge in high intent shoppers resulting from co-marketing and a flexible, seamless payment journey. Tamara’s partners include regional and global brands such as SHEIN, IKEA, Jarir, Noon, eXtra and Farfetch as well as local small and medium businesses. Today, over one-third of Tamara’s users start their shopping journey from the app itself, which leads to a significantly higher return on advertising spend for Tamara’s partner merchants.

Saudi Arabia, and the GCC, are experiencing a rapid and unprecedented growth despite the challenging global macroeconomy. Tamara’s vision goes in parallel to this growth, believing future opportunities are significant with the fintech sector booming across the region. The current lending penetration in Saudi Arabia stands at around 30%, indicating a tremendous growth potential compared to mature markets like Europe, the US or Australia where figures range between 50% to 70%. The region presents abundant opportunities, as cash on delivery commands a significant share of checkout in a thriving e-commerce market, and as the banking sector evolves from its traditional practices.

Buy Now, Pay Later (BNPL) is growing rapidly in Saudi Arabia, with the number of customers registered with a service going from 76 thousand in 2020, to 3 million in 2021, and reaching 10 million in 2022, according to the SAMA Fintech 2022 report. With nearly 30% of the population using BNPL, the industry is being driven by a number of factors, including the increasing popularity of e-commerce. Furthermore, the digital payment volumes are forecasted to grow by 20% CAGR till 2025, reaching 13 billion transactions with a total value of $170 billion.