In the realm of successful tech startups, few ecosystems outside of Silicon Valley can rival those emerging from schools or early dropouts. When such breakthroughs arise in regions like the Middle East or Africa, they garner significant attention. nnAround ten years ago, three undergraduates from the American University in Cairo—Islam Shawky, Alain El Hajj, and Mostafa Menessy—embarked on an ambitious journey by creating an e-commerce platform in Egypt. At that time, the country’s e-commerce sector was still in its infancy, with a mere 2% household participation, largely due to limited online payment options.nnShawky noted, “There was a disconnect between the offerings of banks and the fintech needs of emerging business models. No one was addressing the digital payment challenges for e-commerce and digital-native startups.” In 2015, while still pursuing their studies, they launched Paymob to establish a payment infrastructure for digital wallets, paving the way for a broader e-commerce landscape. nnWhat started as a modest initiative has rapidly advanced into an omnichannel payment gateway. Paymob now boasts over 50 payment options, including digital wallets, credit cards, buy now pay later (BNPL), and QR payments, enabling more than 350,000 merchants across five nations in the Middle East and North Africa to process both online and offline transactions.nnTo date, Paymob has secured upwards of $90 million in funding, including a recent $22 million extension of its Series B round led by EBRD Venture Capital, bringing the total Series B raises to $72 million.nn**Expanding Merchant Services** nWhen we last featured Paymob in 2022, the fintech catered to just over 100,000 merchants, both local and international. Since then, it has expanded its reach beyond Egypt and Pakistan to Oman, Saudi Arabia, and the UAE, increasing its merchant numbers significantly.nnFollowing its initial Series B round of $50 million in 2022, co-led by PayPal Ventures, Paymob has enhanced its product offerings. CEO Shawky shared insights with TechCrunch on how the company introduced an app designed specifically for small and medium businesses (SMBs), along with embedded checkout solutions and lending products.nn”We assist businesses in accepting, paying, managing, and growing. Acceptance is our core operation, and we enhance our offerings based on that foundation,” explains Shawky. “After onboarding, we guide merchants through digital transactions and progressively support them in managing payables and securing working capital.”nnFor the first time, Paymob achieved profitability in Egypt during the second quarter of this year, with revenues surging sixfold since mid-2022, though it continues to seek profitability in other markets.nnIncreasing its merchant base and boosting revenue per merchant through additional service offerings play a crucial role in Paymob’s success. For instance, merchants currently relying on a basic POS terminal for card payments capture only a fraction of their sales. By collaborating with partners such as Shopify and Tabby, Paymob is enhancing its profitability. This strategic growth model leverages digital solutions without necessitating a large sales force, a feat accomplished with just over 1,000 employees.nn”What excites us the most is maintaining profitable growth; two years ago, the narrative was to halt growth to achieve profitability or conserve resources,” remarked Shawky. “We’ve demonstrated that building a solid business model addressing a client’s actual needs allows for rapid scaling while achieving profitability.”nn**Rise of Digital Payments in the UAE** nThe surge in digital payment adoption is remarkable in both Egypt and the Gulf region. nnIn Egypt, 88% of consumers have utilized at least one new payment method in the past year, and 85% of SMEs recognize the importance of adopting omnichannel digital payment solutions for their growth, according to a Mastercard report. In contrast, the UAE shows even higher demand for digital payment solutions, with a notable 77% adoption rate.nnInsights from conversations with industry founders indicate that despite robust demand, the market remains ripe for service. Consequently, fintech companies, including Paymob and local competitors like Ziina, are racing to meet the needs of around half a million merchants, capitalizing on the UAE’s strong inclination towards digital payment solutions.nnThe astounding demand is evident, with Paymob achieving significant transaction volumes within the UAE in just 14 months, matching the entirety of its five-year Egyptian operation. Contributing factors include stronger purchasing power, resilient currency, and a greater prevalence of digital wallet usage compared to cash.nnAlthough Egypt remains its primary market, Shawky is optimistic that Paymob’s suite of products, aimed at fostering a cashless society in conjunction with ongoing efforts from the government and central bank, will elevate Egypt’s digital payment landscape to levels comparable with the UAE.nnShawky remarked, “For Egypt’s economy to hit this pivotal point, issuing and accepting digital payments must go hand in hand. The central bank is actively investing in the country’s digital infrastructure.” He further noted that the company’s sixfold growth over the last two years not only reflects an increase in its merchant base but also enhanced processing volumes from these merchants.nnPreviously, Paymob reported a payment volume reaching $5 billion in 2020, facilitating over 120 million transactions within the same year. However, updated figures for these metrics are currently undisclosed.nnThe company’s Series B round also saw participation from prominent investors, including Endeavor Catalyst, alongside existing backers like British International Investment (BII), FMO, A15, Nclude, and Helios Digital Ventures (HDV).