UAE: Split rent payment app coming soon, and loans based on remittances?

As part of its FinTech Accelerator Program, the Dubai International Financial Center (DIFC) will establish a neobank that would lend money to migrant workers based on their remittances.

Started by a Tajikistani native named Bobur Murvatov, Planet 9 seeks to provide migrant workers with small loans that they can repay with their earnings. Bobur established the start-up based on his own insights and experiences.

“Tajikistan alone supplies two million migrants,” he said, speaking to Khaleej Times. “We are a remittance-dependant economy. Most of the families of migrants remain unbanked. It is almost impossible for them to get funding or loans.”

A number of businesses, including Planet 9, displayed their goods during the Investor Day, which highlighted the successes of the start-ups and young professionals that made the shortlist for this year. Company founders had two minutes during the event to present their concepts to senior DIFC officials as well as business partners. In addition, the event served as the program’s conclusion for DIFC AccelerateHER and included a number of panel discussions and fireside talks.

Democratising loans

For Bobur the idea was to democratise the ability of families of migrants to get loans and to help migrants in the countries where they work. “Most of the migrants don’t have a credit history,” he said. “They are not eligible for lending or most of the banking products. So I wanted to create a product that would streamline the process of giving migrants loans.”

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Planet 9, which is already operational in two countries in Central Asia, is launching a product in the UAE called Send Now Pay Later (SNPL). “We are working closely with exchange houses for this,” he said. “It is a Dh50 million remittances market. There is a lot of potential there.”

Bobur said the process has been made easy for migrants. “The whole process usually takes a minute where by uploading just his Emirates ID, we are able to see his entire financial information,” he said. “Using our AI model, we are able to identify how much money we can lend to him for a short period of three months. It gives us a loan limit which we then offer the migrant.”

He said there has been massive interest from the UAE for the product. “There are eight million migrants in the UAE,” he said. “A customer survey has shown us that many of them fall prey to loan sharks because of their inability to get any kind of loans from banks in the UAE.”

Program

According to Mohammad AlBlooshi, Chief Executive Officer of the DIFC Innovation Hub, the accelerator programme has been a core part of the hub since its inception. “We’ve graduated more than 200 companies from this program since its inception,” he said. “We have several success stories like Sarwa and XYA. The amount of funding that has been raised by this program by the graduates of this program since it started is more than $600 million.”

He further added that this year’s programme has been immensely successful. “This year we are graduating 19 companies,” he said. “There are the startup pitches and then you also have companies exhibiting. This gives an opportunity for investors, corporates or any other governments who are keen on partnering with them to interact and talk to them.”

Second chance

Charlie Berbari started his project Ezyrent because he wanted to give his dream project another chance. The second version of his MBA project, Ezyrent, is an app that lets users divide their year rent into monthly payments. “Back in 2017, we wanted to introduce factoring to the real estate market, which means selling the receivables for someone,” he said. “However, after talking to industry experts, we gave up because the market was not ready for it.”

Charlie, however, made the decision to give his dream idea another shot by changing it to suit market demands because rents in the UAE are growing.“Last year there was an increase in rents of 36%,” he said. “These numbers keep on rising. Increasingly, one-cheque payments have become the norm and people are finding it hard to raise that kind of money. What we want to do is, offer a 12 month payment solution and provide people with rental insurance which will make sure that their rent is paid even if they lose their jobs.”

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