Saudi Unicorn Looks Beyond Kingdom After Western Union Deal
(Bloomberg) -- Saudi Arabian digital payments firm stc pay, which was valued at $1.3 billion in a funding agreement with Western Union this month, is set to become profitable “very soon” and is in talks with regulators to expand into neighboring countries.
The company, launched by the kingdom’s biggest mobile operator Saudi Telecom Co. in late 2018, wants to offer digital payments across the six-nation Gulf Cooperation Council, Chief Executive Officer Ahmed Alenazi said in an interview.
Digital payments in the Middle East have grown rapidly as the pandemic forced more consumers to shop online. Moving Saudi Arabia toward non-cash transactions is also part of Crown Prince Mohammed bin Salman’s plan to diversify the kingdom’s economy away from oil.
Stc pay has already processed 24 billion riyals ($6.4 billion) of remittances since launch and attracted 4.5 million customers, Alenazi said.
The company is also in talks for a digital banking license in Saudi Arabia that will enable it to offer more financial services beyond payments and remittances.
“We are already handling millions of transactions every month, and we know the path to the break-even point and it’s not that far,” Alenazi said. “Very soon we will become profitable.”
Western Union invested $200 million for a 15% stake in stc pay, in the latest sign that Saudi Telecom is pushing into new business areas. It launched a $500 million venture capital fund in 2017 and is planning to sell shares in its internet services unit, Solutions by STC, people familiar told Bloomberg in September.
(Updates with diversification plan in third paragraph.)
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