Pakistani Shariah-compliant buy-now-pay-later startup makes waves globally

The photo posted on May 19, 2023, shows the co founders of Pakistani start-up KalPay. (Photo courtesy: KalPay/Facebook)
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Updated 06 June 2023

Pakistani Shariah-compliant buy-now-pay-later startup makes waves globally

  • Shershah Hassan, Waleed Amjad Islam KalPay featured on Forbes “30 under 30 Asia” list this year
  • KalPay allows customers to buy products and pay in three equal installments without interest

KARACHI: It was in 2020 that school and university friends Shershah Hassan and Waleed Amjad Islam began brainstorming a business idea that would help change people’s lives.

Hassan, 26, and Islam, 25, came up with Kalpay, a Shariah-compliant buy-now-pay-later (BNPL) startup that is making waves globally and was featured on this year’s prestigious Forbes “30 under 30 Asia” list.

Launched in June 2021, KalPay is already working with around 500 e-commerce merchants across multiple product and service categories, allowing customers to buy products and pay in three equal monthly installments using cards, e-wallets and bank transfers without any interest or extra charges.

Credit card penetration is less than 1 percent in Pakistan and almost 90 percent of transactions are done by cash. Pakistan has the third largest unbanked adult population globally, with about 100 million adults without a bank account in a population of 220 people, according to the World Bank.
“The idea was generated back in 2020, we thought about a product that could help ease financing problems and offer solutions to basic banking problems,” Hassan, who is the CEO and cofounder of KalPay, told Arab News in an interview on Monday.

“The drive was that I have to do my own business and the goal was that the work should be impact focused to improve the lives of consumers by giving them access to finance,” he said. “That dream is being fulfilled.”

After bootstrapping for around 9 months, Hassan raised investment in June 2021 and then left his job at a US company. In October of that year, he launched the startup along with his friend Islam. The funding came from local and foreign investors, including venture capital firms and angel investors from Saudi Arabia, Europe, Singapore and the United States.

“Currently KalPay is working on three verticals and providing BNPL ecommerce-based solutions through working with 500 companies and giving users access to easy financing,” Hassan, who is an Accounting and Finance graduate from the Lahore University of Management Sciences (LUMS), said.

The KalPay chief said his firm offered financing between Rs2,000 to Rs500,000, that could be paid back in three installments. Two of its new verticals are KalPay Rasayi and KalPay Taleem, offering BNPL services on the purchase of productive assets like smartphones and laptops and fee payments for education and skill development services. 

“If we are financing a laptop or a smartphone to a freelancer or Foodpanda rider, the laptop and smartphone are the source of income to them,” Hassan explained. “That is how we are creating impact in society because these products could change the lives and future of people.” 

The startup’s growth in terms of value and volume is in double digits on a month-on-month basis, and Hassan said he and his partner were planning further growth and consolidation.

Responding to a question about the rationale behind launching a Shariah-compliant product, Hassan said his research had revealed that a majority of people in Pakistan didn’t want to engage in interest-based financing.

“Obviously our [Pakistani] market is Muslim majority, so while searching from a financing perspective, one thing came into the spotlight that some customers don’t get financing because of religious concerns and I also wanted to have Shariah-compliant products,” Hassan said, adding that the service was not only for Muslims.

Talking about the challenges of the business, especially amid record inflation in Pakistan, Hassan said:

“The cost of capital and cost of financing has substantially gone up [in Pakistan]. Of course, it is a tough market to operate and the risk remains that if you are giving a loan to someone today and after six months he won’t be able to pay back.” 

The CEO admitted that some people defaulted but said the ratio remained in the single digit. 

Commenting on the cofounders’ inclusion in the Forbes list, Hassan said it came as a surprise.

“It was a sort of surprise for me because they don’t disclose before publication,” he said. “It is an honor for me, my team and of course, for Pakistan.”

Pakistani authorities arrest journalist for allegedly spreading false news about state institutions

Updated 13 sec ago

Pakistani authorities arrest journalist for allegedly spreading false news about state institutions

  • Khalid Jamil was arrested by the FIA and an Islamabad court allowed it to hold him for questioning for two days
  • The arrest has drawn condemnation from the journalist community in a country that is viewed as unsafe for reporters

ISLAMABAD: Pakistani security agents have arrested a senior Islamabad-based TV anchor known for his criticism of the authorities on charges of spreading false content about state institutions on social media, his news channel and family said Friday.

Khalid Jamil was taken into custody by the Federal Investigation Agency late on Thursday, his ABN television posted on X, formerly known as Twitter.

Jamil’s family confirmed the arrest, saying he was detained in a late-night raid at his home in the capital, Islamabad. A photograph of Jamil circulating on social media shows him holding up a sign with his case number, apparently in police custody.

Later Friday, an Islamabad court gave the green light for the agency to hold Jamil for questioning for two days.

The arrest has drawn condemnation from the country’s journalist community. Pakistan has long been an unsafe country for reporters. In 2020, it ranked ninth on the Committee to Protect Journalists’ annual Global Impunity Index, which assesses countries where journalists are regularly harassed and killed and the assailants usually go free.

In recent years, activists and journalists have increasingly come under attack by the government and the security establishment, restricting the space for criticism and dissent. The criticism of the military can result in threats, intimidation, sedition charges and in some cases, being arrested with no warning.

Pakistan’s finance minister unveils centralized gateway portal to boost country’s debt market

Updated 18 min 19 sec ago

Pakistan’s finance minister unveils centralized gateway portal to boost country’s debt market

  • The platform will streamline investor onboarding process and enhance convenience of market intermediaries
  • The portal will be a major part of Pakistan’s financial infrastructure and will list government debt securities

ISLAMABAD: Pakistan’s interim finance minister Dr. Shamshad Akhtar inaugurated a centralized gateway portal (CGP) on Friday, saying it would help develop debt market in the country by listing government securities to promote retail participation, transparency, savings channelization, and overall market growth.

Debt or bond markets constitute financial arenas in which people buy and sell various types of debt securities representing loans made by investors to entities such as governments, corporations, or other organizations.

These securities are typically issued with the promise of periodic interest payments to bondholders and the repayment of the principal amount at maturity.

According to a statement released by the Securities and Exchange Commission of Pakistan (SECP), the CGP is a novel financial initiative to facilitate simultaneous onboarding of investors and customers across the securities market, the nonbank financial companies’ sector, and the insurance industry.

The platform features standardized, one-time know-your-customer requirements across diverse asset classes.

“Dr. Shamshad Akhtar, the Federal Minister for Finance & Revenue, said that the securities market can play a vital role in the development of debt market through the listing of government debt securities on PSX [Pakistan Stock Exchange],” said the SECP statement.

Addressing the inauguration ceremony, Akhtar said the issuance of securities through public auctions at PSX would facilitate greater transparency.

“One of the key issues undermining the growth of capital markets is the lack of liquidity which is directly attributable to the small number of investors,” she was quoted as saying.

The minister said the CGP would provide immense opportunities to investors and great convenience to market intermediaries by removing duplications and streamlining the customer onboarding process.

However, she noted the successful CGP launch should not be deemed the end of the project.

“Having developed this promising digital platform, we are now faced with the critical part of realizing the potential it offers,” she continued. “This requires focused marketing efforts and promotion on the part of the PSX and other stakeholders like brokers, insurance companies, and AMCs [asset management companies].”

The minister pointed out that attracting new investors in the capital market should be one of the primary objectives, adding it would require coordinated efforts from all capital market infrastructure institutions, market intermediaries and brokerage houses under the SECP guidance.

Amid cutthroat politics, PPP suspends senior leader for joining ex-PM Khan’s legal team before elections

Updated 22 September 2023

Amid cutthroat politics, PPP suspends senior leader for joining ex-PM Khan’s legal team before elections

  • Sardar Latif Khosa was asked to explain his position after he started representing Khan without seeking party’s approval
  • Khosa criticized the state for charging the ex-premier for violating Official Secrets Act at a recent lawyers’ convention

ISLAMABAD: In yet another sign of cutthroat politics ahead of national elections slated for January, Pakistan Peoples Party (PPP) suspended the membership of one of its senior leaders on Friday for joining former prime minister Imran Khan’s legal team to defend him in multiple cases filed against him.

Sardar Latif Khosa, a lawyer and member of the PPP central executive committee, was issued a show-cause notice last week wherein he was asked to explain the reason behind his decision for “defending the leader of another party” without the approval of the leadership of his own political faction.

The former prime minister has been in a high-security prison after he was arrested in a graft case last month in which a local court sent him to jail for three years. While his initial sentence was suspended by the higher judiciary within weeks, his judicial remand was extended in a more serious matter involving the misuse of a confidential diplomatic cable which was deemed as a violation of the Official Secrets Act.

“The Secretary-General of the PPP, Syed Nair Hussain Bukhari, has suspended the membership of Sardar Latif Khosa,” the party said in a statement on Friday. “Khosa’s membership to the party’s central executive committee has also been revoked.”

It added the decision was taken after Khosa failed to respond to the show-cause notice served to him.

The notice highlighted Khosa’s speech at a lawyers’ convention in which he criticized the state policy regarding the case related to the secret diplomatic dispatch.

“You are hereby through this show cause notice asked to explain why disciplinary action not be taken against you for working against the party policy,” he was asked.

Pakistan’s election regulator has barred Khan from contesting elections for five years due to his conviction in the corruption case.

The prolonged restriction has provided an opportunity to other parties in the country to build momentum as national polls in January draw closer.

Pakistani minister seeks enhanced pilgrimage arrangements in meeting with top Saudi Hajj official

Updated 22 September 2023

Pakistani minister seeks enhanced pilgrimage arrangements in meeting with top Saudi Hajj official

  • Aneeq Ahmed urges Saudi minister to accommodate Pakistani pilgrims near areas where Hajj rituals are performed
  • The Saudi minister says the kingdom has limited the number of private tour operators to improve Hajj services

ISLAMABAD: Pakistan’s interim religious affairs minister Aneeq Ahmed discussed pilgrimage arrangements for next year with Saudi Hajj and Umrah minister Dr. Tawfiq Al-Rabiah on Friday, requesting him to accommodate people from his country in areas situated closely to the places where the annual religious ritual is performed.

Ahmed is currently on a week-long visit to the kingdom where he has held meetings with senior officials to explore the possibility of expanding the Makkah Route Initiative beyond Islamabad to make the journey of Pakistani pilgrims more convenient.

He said after his conversation with the Saudi minister that the kingdom had agreed to increase facilities for people of Pakistan who are interested in performing Hajj in the coming year.

“Accommodation, food and travel facilities for pilgrims will be finalized as soon as possible,” Ahmed was quoted as saying in a statement by his ministry.

“He asked Saudi Minister Dr. Tawfiq Al-Rabiah that flight schedule of Pakistani pilgrims should be finalized soon,” the statement continued. “Additionally, they should be accommodated near the pilgrimage places. The Makkah Route project should also be launched from other cities besides Islamabad.”

Pakistan’s interim religious affairs minister Aneeq Ahmed (second left) holds a discussion with Saudi Hajj and Umrah minister Dr. Tawfiq Al-Rabiah (second right) in Riyadh, Saudi Arabia, on September 22, 2023. (Photo courtesy: Pakistan's religious affairs ministry)

It added the Saudi minister pledged to offer more support to Pakistani pilgrims, saying the kingdom had already taken several measures to facilitate people performing Hajj.

He said that it had limited the number of private tour operators from 80 countries in the world and would only allow those companies that have 2,000 pilgrims.

“Karachi and Lahore are being considered for inclusion in the Makkah Route Initiative,” he added.

The initiative was introduced in Pakistan to provide customs and immigration services to pilgrims at their airport of origin to save them substantial time after arriving in Saudi Arabia.

According to official statistics, more than 26,000 Pakistani pilgrims benefited from the facility at the Islamabad airport this year.

Imran Khan’s woes set to rule him out of Pakistan election race

Updated 22 September 2023

Imran Khan’s woes set to rule him out of Pakistan election race

  • Participation of Imran Khan, the main opposition leader and former prime minister, in January’s general election is doubtful
  • Khan remains in jail after being convicted in a graft case in August despite his three-year sentence being suspended by a court

ISLAMABAD: The participation of main opposition leader and former Prime Minister Imran Khan in Pakistan’s general election set for January next year remains doubtful. Khan, winner of the last election in 2018, remains in jail after being convicted in a graft case in August despite his three-year sentence being suspended by a court.

Here are some facts about the options for Khan, 70, who is the country’s most popular party leader according to independent opinion polls:


Khan, 70, remains barred from holding public office for five years due to his conviction, despite the suspension of his jail sentence. The bar will remain in place until his conviction is overturned by the high court, where he has appealed, a situation that currently rules him out of the January elections.

It remains unclear if his appeal will be decided in time for the next election, but aside from this graft case, the former cricket star faces dozens of other serious cases, too, which carry sentences from five years up to a death penalty.


Khan remains in judicial custody for a case related to leaking state secrets, which is at a pre-trial stage being heard by a special court that holds proceedings at a prison where he’s detained on security grounds. This week, another court allowed police to add sedition charges against him in two cases related to abetting attacks against military installations on May 9 by his supporters to protest against his brief arrest.


Khan’s Pakistan Tehreek-e-Insaf (PTI) party can still contest the elections and will seek to tap into a sympathy vote, but it has been severely hobbled by the departure of key leaders in the aftermath of the May violence and the crackdown that ensued.

In Khan’s absence, the PTI was being led by former Foreign Minister Shah Mahmood Qureshi, but he too has been arrested in the state secrets case.


Analysts say the military-backed caretaker government, which has been questioned by the election commission over its credibility, wouldn’t let Khan bounce back, especially as independent polls show him to be the most popular party leader, a standing that could earn the PTI a good showing in January’s election.

Khan and his party continue to accuse the military of being behind his ousting and the crackdown.

The military, which according to analysts brought Khan to power in 2018, denies being behind his removal. His criticism of the armed forces and its top brass has not eased, and his appeals to the military to open talks with him haven’t yielded a response.

The military’s support remains key to anyone looking to attain power in Pakistan.