Pakistani fintech PostX has acquired logistics provider Call Courier, creating what it describes as the largest e-commerce service provider in the country. PostEx now serves 1.3 million users with more than 8,000 merchants in 500 cities in Pakistan and operates a credit book of over $12 million.
The acquisition means Call Courier will become a wholly owned subsidiary of the group. In a country where more than 90% of e-commerce payments are still settled in cash, PostEx offers prepayment and income-based financing for e-commerce sellers and SMEs.
PostX founder and CEO Omer Khan told TechCrunch that according to the World Bank, 100 million adults in Pakistan do not have a bank account. As a result, businesses have limited access to working capital and insufficient cash flow. On the other hand, consumers are wary of digital transactions, and even many with bank accounts prefer to pay cash on delivery for items ordered online.
But cash on delivery is problematic for e-commerce businesses because they have high rejection rates at the door. Additionally, it often takes up to two to three weeks for cash on delivery purchases to be deposited into a business’s bank account, compared to a few days for digital payments.
As a result, PostEx’s founding team decided there was potential to build a reliable logistics service provider and cash advance. Advance payments mean online vendors don’t have to wait for long payment cycles and have better cash flow.
“We’re making it easier for businesses to reach more customers, take care of their supply needs and provide advance liquidity,” Khan said. “This is important for small businesses that need every penny to take care of themselves.”
In terms of competition, Khan says the reason behind PostX’s novelty is its mix of fintech and logistics. It has raised $8.6 million to date, and its backers include Zain Capital, Global Founder Capital, MSA Capital, RTP, FJ Labs and Shorooq.
In a statement, Senator Afnan Ullah Khan, a member of the Prime Minister’s IT Task Force Committee, said, “This acquisition demonstrates the importance of close collaboration between fintech and logistics in access to capital. This acquisition will make PostEx the largest e-commerce service provider in the market, demonstrating its potential for challenging startups. It’s exciting to see new solutions to old problems.
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