Startup Cashew receives USD 10 mln investment from Mashreq

UAE-based lender Mashreq has invested USD 10 million in fintech startup Cashew, integrating the latter’s BNPL platform in its payments subsidiary.

As part of the investment, Cashew’s payment platform will be integrated as an option on the acquiring network of Neopay, the payments subsidiary of Mashreq. The lender will also support the startup to launch in Egypt in the last quarter of 2022.

In March 2022, Mashreq carved out its payments arm into its new division Neopay, to facilitate businesses handle credit and debit card payments amid a pandemic-fuelled ecommerce increase. Mashreq's investment is part of a larger funding round that involves other investors as well, Cashew said. Since its inception, the fintech start-up has raised nearly USD 10 million.

BNPL platforms allow consumers to make purchases without paying the full amount upfront, avoiding the use of credit cards and hefty interest charges. Merchants are still protected through credit risk checks, late fees, and blocks on customers who have defaulted.

Under the partnership, Cashew and Mashreq will offer new products to the market including longer tenure and higher ticket size BNPL options for consumers, the companies said in a joint statement. They also plan to introduce point-of-sales lending options in the region in 2022. It will allow consumers to opt for BNPL but with larger tenures such as six or 12 months.