Dbank raises $17.6 million in seed funding

Dbank raises $17.6 million in seed funding
Dbank raises $17.6 million in seed funding

Dbank, an Islamabad-based fintech startup, has raised $17.6 million in seed funding from Sequoia Capital, Kleiner Perkins, Nubank, Askari Bank, RTP Global, and Rayn.

Elevator pitch: Simplifying the borrowing, transacting, and saving of money.

Backstory: In January, the State Bank of Pakistan announced a license and regulatory framework for digital banks, which outlined details for setting up digital banks as a separate category in the country. 

In short, a digital bank allows you to open an account, deposit money, and borrow money without going to a physical branch.

SBP will grant two types of digital bank licenses under this framework to increase financial inclusion:

  • Digital Retail Bank (DRB)
  • Digital Full Bank (DFB)

DRBs primarily focus on retail customers, while DFBs can deal with retail customers and business and corporate entities.

SBP said it received 20 applications for the digital banking license. And one of the applicants is Dbank, seeking a Digital Retail Bank (DRB) license.

Tell me more: According to the World Bank, over 100 million people in Pakistan lack access to banking services, making it the third-largest unbanked country after India and China.

Through RAAST, a real-time payment system launched by the State Bank of Pakistan, fintech startups like Dbank are exploring opportunities for increasing financial inclusion.

Through a digital-native approach, Dbank wants to democratize banking and make a wide range of financial services friendly, transparent, and accessible for all.

You should know: Tania Aidrus and Khurram Jamali founded Dbank in 2021.

Both worked on building the payment infrastructure for Google’s Next Billion Users initiative while researching the challenges faced by the unbanked.

In April, Tania tweeted that Sequoia Capital and Kleiner Perkins would be backing her new digital banking startup. And today, Dbank officially announced the amount of funding.

Sequoia Capital will be investing in Pakistan through its $850 million Southeast Asia fund for the first time. This also marks Kleiner Perkins’ second investment in Pakistan. 

Also, $17.6 million is Pakistan’s largest seed round ever.

Zoom out: Students, freelancers, and others that can’t document their income make up the majority of the unbanked population in Pakistan. 

This, coupled with a growing middle class, presents an excellent opportunity for startups to build more inclusive digital-native banks that cater to consumers neglected by traditional banks.

Dbank’s competitors include Sadapay, Nayapay, TAG, and MyTM.

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