PostEx Acquisition
The country Pakistan’s e-commerce sector due to adoption and growth scales is predicted to hit $12B by 2025. In propelling this growth PostEx, Pakistan’s fintech leader has acquired Call Courier a logistics service provider, to expand its logistics offering making it Pakistan’s largest e-commerce service provider. This acquisition combines PostEx’s upfront payments, revenue-based financing, and technology with Call Courier’s national and international logistics infrastructure.
Service Destinations
Following the acquisition, PostEx will now service 1.3m users with over 8,000 merchants across 500 cities in Pakistan, to become the largest fintech in Pakistan having a monthly loan book of more than $12 million.
This acquisition means that Call Courier will become a wholly owned subsidiary under PostEx. The startup welcomes Jawad Mirza, Call Courier’s founder, and CEO to its Board of Directors and will continue to play an essential role in the business while leading the logistics business. The startup PostEx provides services like revenue-based financing for e-commerce sellers and SMEs and upfront payments in a country where more than 90% of e-commerce payments are still completed in cash.
The Main Problem
Omer Khan the co-founder and CEO of PostEx told TechCrunch that according to the World Bank, about 100 million adults in Pakistan don’t have a bank account. As a result, businesses have limited access to working capital and lack adequate cash flow. On the other hand, consumers are wary of digital transactions, and even many who have bank accounts still prefer to pay cash on delivery for items ordered online.
Around 90% of e-commerce transactions are completed in cash, which represents nearly $6.5bn. The consumer’s majority that shop online in Pakistan pay using the cash-on-delivery payment method and the payment cycles for such orders range between 2 or 3 weeks to a month which creates cash flow issues for online sellers.
As a result, the startup PostEx’s founding team decided and knew that there was potential to make a reliable logistics service provider, also upfront cash. Upfront payments mean that online retailers no longer need to wait through long payment cycles, and have better cash flow.
“We’re out there making it simpler for businesses to reach out to more customers, take care of their delivery needs and provide them with upfront liquidity,” said Omar Khan. “This is essential for smaller businesses that need every penny to sustain themselves.”
Call Courier’s strong presence in Pakistan completes PostEx’s vision and nationwide footprint. This strategic decision gets PostEx’s full presence to above 500 cities; serving up to 1.3 million people monthly across the nation as the acquisition allows both companies to leverage each other’s technological and operational expertise.
Founder & CEO of Call Courier Jawad Mirza commented: “Having more than 2 decades worth of experience in the logistcs and last mile delivery industry has given us an understanding of not only bulk mail but also ecommerce, cash on delivery and the needs of the sector. With this acquisition, it is time for us to venture into new horizons, accept new challenges, and continue to grow. Call courier network joining together with PostEx’s fintech capabilities will enable us to provide quality deliveries across Pakistan along with financial support to the sector. It gives me immense pleasure to serve existing and new customers and providing a one window solution for their needs.”
Senator Afnan Ullah Khan, a member of the Prime Minister’s IT Task Force Committee said, “Consolidation and growing together is important at this juncture for our nascent ecosystem. This acquisition shows the importance of close collaboration between fintech and logistics highlighting the importance of access to capital. This acquisition makes PostEx the largest e-commerce service provider in the market, showing the potential of startups for challenging incumbents. It’s refreshing to see new solutions to old problems.”
AUC Law, Salahuddin, Saif & Aslam Co., and MHBWHB Law Associates were the legal advisors for the transaction.