moneyhash Secures $5.2M Funding - MENA Payment Services

Streamlining Payments in Emerging Markets: MoneyHash Secures $5.2 Million

As online businesses grow and extend their reach, they frequently encounter the need to integrate multiple payment processors. This is often necessary to cater to diverse customer preferences and comply with varying regional regulations. However, this process can present significant challenges.

Addressing the Complexities of Payment Integration

Companies like Egypt’s MoneyHash are emerging to simplify this complex landscape. They assist merchants throughout the Middle East and Africa in effectively managing intricate payment stacks. Recently, MoneyHash raised $5.2 million to facilitate its expansion and target larger enterprise clients.

This pre-Series A funding round follows a $4.5 million seed round announced in February 2024. Since its inception in early 2021 by Nader Abdelrazik and Mustafa Eid, MoneyHash has now secured over $12 million in funding.

The Rise of Payment Orchestration

MoneyHash operates within the field of “payment orchestration.” In the fragmented payments world, where businesses often utilize numerous providers for payment processing, this area is gaining prominence alongside the growth of online transactions. Integrating multiple payment systems can be both operationally inefficient and technically demanding, often requiring weeks of work from internal tech teams.

These difficulties are particularly pronounced in Africa and the Middle East, due to the wide array of payment methods and currencies in use. Payment orchestration platforms address these issues by consolidating and simplifying payment processes across different regions through APIs.

Identifying a Critical Need in the Market

Abdelrazik and Eid established MoneyHash after observing firsthand the challenges faced by businesses in fintech and enterprise software. They recognized that payments are fundamental to a company’s operations, growth, and profitability.

However, they also noted that payment failures are three times higher in the region than the global average, and cart abandonment rates exceed those in developed markets by over 20%. They determined that orchestration offered a solution, enabling merchants to avoid high operational costs and revenue loss.

MoneyHash’s Comprehensive Solution

“The opportunity to solve this is immense,” stated CEO Abdelrazik. “Digital payments currently represent a small portion of total transaction volume in emerging markets, indicating substantial growth potential over the next decade.”

MoneyHash integrates with a merchant’s existing payment providers, offering a streamlined approach to managing their entire stack. Key features include a unified API for both pay-in and pay-out operations, customizable checkout experiences, advanced transaction routing with fraud prevention, failure rate optimization, and detailed reporting tools.

The platform also supports recurring payments, virtual wallets, subscription management, and payment links, providing a complete solution for merchants.

Differentiating Factors and Market Position

Similar to companies like Payrails, Spreedly, Zooz, and Primer in the U.S., U.K., and Europe, MoneyHash focuses on serving customers in the Middle East and Africa. Abdelrazik emphasizes that this regional focus, combined with its extensive integration network – encompassing over 300 pre-integrated APIs – sets MoneyHash apart.

These integrations include both local and international processors and gateways such as Adyen, Amazon Pay, Checkout, Fawry, Mono, Stripe, Tabby, and ValU, covering over 100 markets. Precium (formerly Revio), a South African startup backed by QED, offers comparable services in the region.

Expanding to Serve Larger Enterprises

Initially targeting smaller merchants, MoneyHash began focusing on larger enterprises in early 2024 with the launch of its enterprise suite. This strategic shift has enabled the company to achieve significant growth.

“Without our software, substantial performance improvements require years of effort and study. However, with MoneyHash, all key payment metrics – authorization, conversion, and fraud rates – reach optimal levels,” Abdelrazik explained.

A Holistic Approach to Payment Optimization

“We don’t concentrate solely on a single metric to address all problems within the payment chain. Enterprises require a comprehensive solution that covers the entire payment cycle, and that’s precisely what we deliver.”

Currently, enterprises in sectors like consumer fintech, hospitality, e-commerce, and gaming account for 35% of MoneyHash’s customer base, a threefold increase in 2024.

Customer Success and Funding Momentum

Tamara, a BNPL unicorn, highlights MoneyHash’s ability to “build an important point of difference,” potentially referencing its claims of increasing revenue generation by 10-20% while reducing go-to-market and development costs by 90%.

Abdelrazik attributes the startup’s strong enterprise pipeline and long-term contracts to securing the pre-Series A funding. These customers have driven a 4x increase in processing volume and a 3x revenue increase over the past year, although specific financial details remain confidential.

Investment Details and Future Outlook

Flourish Ventures led the funding round, with participation from Saudi’s Vision Ventures, Arab Bank’s Xelerate, and Emurgo Kepple Ventures. Jason Gardner, founder and former CEO of Marqeta, also contributed, marking his first investment in the region. Existing investors, including GitHub founder Tom Preston-Werner and COTU Ventures, also participated.