Tamara, a shariah-compliant buy now, pay later (BNPL) service, is making a significant impact in the regional market. Founded in Riyadh, Saudi Arabia, in late 2020 by serial entrepreneur Abdulmajeed Alsukhan, Turki Bin Zarah, and Abdulmohsen Al Babtain, Tamara has grown rapidly, with a focus on customer satisfaction, transparency, and fairness. The company aims to revolutionize the financial services sector while staying true to its roots and values.
The Genesis of Tamara
The idea for Tamara was born when Abdulmajeed Alsukhan noticed the debt ledger system in local neighborhood shops, which allowed customers to buy items on credit and settle their accounts at the end of the month. Inspired by this concept, Abdulmajeed researched the global markets and discovered AfterPay, a popular BNPL company in Australia. Recognizing a substantial opportunity, he decided to introduce a similar service to the regional market, leading to the founding of Tamara in Riyadh, Saudi Arabia.
Addressing a Market Need
Although the BNPL concept was not unique, Tamara’s rapid execution and resonant product helped fill a gap in the market. Their business model is based on taking a percentage of the purchase price from stores rather than customers. Stores agree to give them a fee because it helps them boost their sales as customers would have more buying power. A customer who has only $100 in cash can buy a $200 item with Tamara and pay them over three installments. This service is especially helpful to online stores because larger orders mean more savings on the costs of shipping and packaging. Fees in this market average around 5% but can vary significantly.
A Unique Approach: Shariah Compliance and Charitable Contributions
Tamara sets itself apart by being a shariah-compliant service, refraining from charging interest on payments. Although they do levy a late fee, this is solely intended to encourage timely payments. Moreover, the late fee is not a part of their business model, with the proceeds being donated to charities. Tamara’s vision revolves around building a financial service provider that garners genuine love and appreciation from its customers and actively contributes to improving their lives.
Impressive Growth and Global Expansion
Starting with just seven part-time employees in 2020, Tamara has experienced remarkable growth, now boasting more than 320 employees and offices in KSA, UAE, Egypt, Germany, and Vietnam.
Tamara’s $110 million Series A round in 2021, led by Checkout.com, broke records as the largest ever in the Middle East. To date, the company has raised $366 million, including a $150 million debt facility from Goldman Sachs Group, showcasing its potential and strong investor backing.
Growing Customer Base and Partner Network
Tamara currently serves over 5 million customers and has more than 12,000 partner merchants, including leading global and regional brands like IKEA, SHEIN, Adidas, Namshi, and Jarir, as well as local SMEs. This extensive network demonstrates the company’s widespread appeal and market relevance.
Distinctive Features: Character and Core Principles
Abdulmajeed cites “character” as the key differentiator for Tamara, with the company’s core principles being fairness, transparency, and seamlessness. The financial sector often falls short in one or more of these areas, making it challenging to find a service that encompasses all three. By adhering to these principles in product development, Tamara is confident in building a sustainable and successful business.
Tamara’s shariah-compliant foundation, commitment to social responsibility, and unwavering dedication to its guiding principles have positioned the company as a trailblazer in the regional BNPL market. With its record-breaking funding, expanding global presence, and growing customer base, Tamara is poised to continue making a significant impact in the financial services sector while staying true to its unique vision and values.
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