ValU, the Egyptian financial technology platform best known for its popular “Buy Now, Pay Later” (BNPL) service, is set to become a publicly traded entity on the Egyptian Exchange (EGX) after its parent company, EFG Hermes Holding, announced board approval for the listing. The decision, revealed in a statement to the Egyptian stock exchange, also includes a plan to distribute a portion of EFG Hermes’ profits to its shareholders in the form of ValU shares, a move designed to pave the way for active trading of the fintech firm’s stock.

The board’s approval signifies a major step in ValU’s trajectory, authorizing the company to proceed with the formal listing procedures. This includes completing registration with the Egyptian Financial Regulatory Authority (FRA) and securing approval for the necessary disclosure report that will inform potential investors about the company’s financials and operations before trading commences.

ValU’s imminent IPO comes on the heels of the company securing a FinTech license from the FRA, a regulatory nod that underscores its commitment to innovation within Egypt’s rapidly expanding digital finance sector. This license empowers ValU to offer a suite of enhanced digital services, including seamless electronic verification for users, legally binding digital contracts, and secure digital record-keeping. According to the company, these technological advancements are designed to transform the customer experience, making financial services more accessible, efficient, and secure for both individuals and businesses across Egypt. The FRA license is also seen as a validation of ValU’s business model and its adherence to regulatory standards within the burgeoning fintech space.

Established as a transformative player in Egypt’s financial services, ValU has gained significant traction with its BNPL platform, enabling millions of consumers to make purchases and pay for them in installments. Beyond this core offering, ValU has expanded its services to include investment products such as the AZ Valu Cash Fund and EFG Hermes ONE, aiming to become a comprehensive financial solutions provider. The company has also introduced a range of innovative programs tailored to the local market, including “Shaqlabaz” for instant cashback rewards, the “Akeed” savings product, and “Ulter” for financing luxury goods purchases.

In a recent strategic move to broaden its reach and enhance customer convenience, ValU partnered with Visa to launch the Titanium credit card. This collaboration offers exclusive benefits to ValU’s growing user base, further integrating its services with traditional financial instruments.

The company has also been actively engaged in Egypt’s debt markets to secure funding for its expansion. Notably, in December of last year, ValU successfully raised $10 million (EGP 519.2 million) through its latest securitization of consumer finance receivables. This transaction was part of a larger EGP 16 billion ($312 million) securitization program, highlighting ValU’s proactive approach to bolstering its liquidity and funding its growth initiatives. Securitization, a common financial practice, involves pooling together loans or receivables and selling them as securities to investors, allowing the originating company to raise capital.

Mai Hamdy, Executive Director of Debt Capital Markets at EFG Hermes, highlighted the significance of ValU’s recent securitization efforts, stating that it reflects the strong collaboration between the two entities and underscores EFG Hermes’ commitment to financial inclusion, innovation, and economic growth in the region. EFG Hermes played a central role in this transaction, acting as the sole financial advisor, issue manager, general arranger, issue promoter, and sole underwriter. The participation of other financial institutions, such as Arab Banking Corporation (ABC), in the subscription process further demonstrates the market’s confidence in ValU’s financial health and future prospects.

While the exact timing and valuation of the IPO remain to be seen, the board’s approval from EFG Hermes marks a critical juncture for ValU and signals a potential turning point for Egypt’s fintech sector. The listing of a prominent player like ValU on the EGX could attract further investment into the sector and encourage other successful fintech startups to consider similar moves, potentially deepening Egypt’s capital markets and fostering greater innovation in financial services. The distribution of ValU shares to EFG Hermes’ existing shareholders is also a notable aspect of the plan, which could generate significant initial interest and create a broad base of investors for the newly listed stock. As ValU moves closer to its public market debut, the financial community will be closely watching its performance and the broader implications for the future of fintech in Egypt and the wider region.