Egypt-based fintech MNT-Halan acquires Advans Pakistan Microfinance Bank

In a significant development for Pakistan’s financial sector, MNT–Halan Pak B.V., a Dutch-Egyptian financial market player, has received approval from the Competition Commission of Pakistan (CCP) to acquire Advans Pakistan Microfinance Bank Limited.

The acquisition process began with a share purchase agreement signed between the companies in August 2023, gaining further momentum with the subsequent approval from the State Bank of Pakistan (SBP) in October 2023. The final step required the approval of the CCP and the fulfillment of certain conditions precedent, both of which have now been met.

Headquartered in the Netherlands, MNT–Halan Pak B.V. operates in Pakistan through its subsidiaries, Halan Wallet (Private) Limited and Halan Finance Limited. The company, formed through a collaboration between Dutch microlending company MNT and Egyptian fintech startup Halan, aims to revolutionize digital transactions in lending and payments.

In February 2023, MNT-Halan raised up to $400 million to fuel global expansion plans

Advans Pakistan Microfinance Bank Limited, the target of the acquisition, represents the Pakistani branch of the renowned Advans Group, a leading international microfinance group with operations spanning nine developing countries.

Established in 2012 with a license from the State Bank of Pakistan to operate as a microfinance bank in Sindh province, Advans Pakistan Microfinance Bank Limited focuses on providing microfinance banking services to underserved segments of society, in line with the objectives laid out in the Microfinance Institutions Ordinance, 2001.

Despite its noble mission, APMBL has faced challenges in Pakistan’s microfinance market, reporting consecutive losses in recent years. With accumulated losses surpassing Rs 1.3 billion as of September 2023, Advans Pakistan had become financially burdensome for the Advans group.

The acquisition involves the purchase of 100% of Advans Pakistan Microfinance Bank Limited from Advans S.A. SICAR, the Luxembourg-based financial services firm. Following a thorough review, the CCP determined that there are no overlaps between the merging entities, ensuring that market dynamics will remain stable post-acquisition.

This acquisition holds significant implications for Pakistan’s microfinance banking sector, underscoring MNT–Halan’s commitment to driving financial inclusion and innovation in the region. With microfinance institutions playing a pivotal role in extending financial services to marginalized communities and contributing significantly to agricultural advances, this move is expected to catalyze growth and resilience in the sector.