Abu Dhabi’s Waha Capital invests $55m in Dubai fintech firm

Abu Dhabi investment company Waha Capital has acquired a significant minority stake in financial technology company Channel VAS for approximately $55 million.

Bassim Haidar, founder and CEO of Channel VAS

Channel VAS, which was originally started in Cameroon but is now based in Dubai, provides mobile financial services in over 25 emerging markets, offering micro-finance lending to more than 500 million mobile network subscribers. The offerings range from airtime credit services and micro-cash loans to credit services for pre-paid utilities.

“We are looking to bank the unbanked. As we know, there are two and half billion adults that do not have access to banks today in emerging markets, and our mission is to get those to tap the financial system,” Bassim Haidar, founder and CEO of Channel VAS.

The company ticks a number of boxes for Waha Capital, and it is consistent with the company’s investment strategy, according to Alain Dib, chief operating officer of Waha Capital.

“First, it is [an] innovative and high growth company. It will also contribute to diversifying our exposure in terms of industry geography. It is a company that is quite young, a four year-old company, but it is growing very fast,” he said.

Dib declined to give the exact stake that Waha acquired in Channel VAS. But the fintech company’s founder noted that Waha Capital is the second strategic investor in a business that he founded and fully funded four years ago.

“We are entrepreneurs so we try to put as many processes in place as we can, and with Waha coming on board it will help us with those processes, with corporate governance, and support us to expand our footprint in the Middle East,” he said.

“If you look at the value of airtime that we lent last year, it was over a billion dollars and our default was under 0.5 percent,” Haidar notes. “We also charge a fixed fee, and there is no time-bound interest rate so the product is Shariah-Compliant in the Middle East and does not have a variance in percentage to value lent.”

“Our default rate is extremely low and that is down to the analytics that we have developed which is the core of our business,” Haidar adds.

Waha Capital currently holds stakes in several companies, including UAE’s National Petroleum Services and New York’s AerCap Holdings NV, an aircraft leasing firm.

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