In addition to receiving a non-banking financial company (NBFC) license, Trukkr, a fintech platform for Pakistan’s trucking industry, announced on Tuesday that it had raised $6.4 million in a funding round.
Trukkr is unique in that it offers fintech to digitize the largely unbanked and undocumented industry. It provides small- and medium-sized trucking enterprises in Pakistan with a transport management system and supply chain solutions.
Accel Venture Lab, based in the US, and Sturgeon Capital, based in London, led the seed funding round. According to a statement from Trukkr, the round also included investors Peter Findley, Al Zayani Venture Capital, and Haitou Global.
The company’s business model has been modified for the Pakistani market but is similar to those used by Kargo in Indonesia, Solvento in Mexico, and Kobo 360 in Africa.
Less than 5% of trucking companies using Trukkr’s platform have access to financial services, which means they often have to wait up to 90 days for payments, making it difficult for them to pay for expenses like fuel, tolls, and truck maintenance.
The CEO and co-founder of Trukkr, Sheryar Bawany, told Reuters that the company planned to introduce financial products at a “reasonable risk-adjusted spread” from the benchmark Karachi Interbank Offered Rate (KIBOR).
About 20,000 drivers, according to co-founder Mishal Adamjee, work for 100 of the largest enterprises in the nation, including Shan Foods, Artistic Milliners, International Industries Limited, and Lucky Cement.
Adamjee stated that despite a lack of adequate railway and water freight infrastructure, Pakistan’s $35 billion per year trucking business is expanding at a 10% yearly rate.
The Covid pandemic, according to investor Accion Venture Lab, showed just how dependent the world is on international supply networks.
“We want to bet on a company striving to tackle inefficiencies in a market filled with opportunities,” it said in the statement.
According to Pakistan’s Board of Investment, projected demand for freight transport will double by 2025 and increase six-fold by 2050 to 600 billion freight tonnes-kilometer, particularly as the China-Pakistan Economic Corridor kicks in.
Truck It In, BridgeLinx, and Freightix are three other freight trade businesses in Pakistan.
