UAE-based fintech startup Alaan raises $2.5m to serve SMEs in the Mideast

• Platform enables businesses to manage expenses smartly, seamlessly, and digitise their payment flow.
• In the UAE, over 80% of consumer payments are digital but when it comes to business payments, still the old world of offline payments still rules, CEO says.

Dubai-headquartered Alaan, a fintech and corporate spend-management platform, has raised $2.5 million in its latest funding round to expand its headcount and scale in multiple markets across the Middle East.

Founded in 2021, the Seed round was led by 468 Capital, Global Founders Capital and Presight Capital, with participation from a number of angel investors including Mato Peric, Erik Podzuweit, and Florian Prucker, founders of Scalable Capital as well as Philippe Teixeira da Mota, founder of Hedosophia.

 “Our vision is to offer SMEs and entrepreneurs an innovative platform to manage company spend, be it through card rails or account-to-account rails. In markets such as the UAE, over 80 per cent of consumer payments are digital. But when it comes to business payments, we haven’t seen the substantial transformation, and the old world of offline payments still rules,” Parthi Duraisamy, CEO and Co-Founder of Alaan, said.

This is where Alaan comes in, he said and enables businesses to manage expenses smartly, seamlessly, and digitise their payment flow.

Frustrating processes

Alaan instantly issues virtual cards in multiple currencies including UAE dirhams, Saudi riyals, and US dollars for e-commerce transactions, SaaS subscriptions, vendor payments, or in-store purchases.

The platform also eliminates expense reports and automates bookkeeping tasks via seamless integration with various accounting solution providers.

“Every company in the region uses different tools for payments, with finance teams spending hours working on manual tasks. Although more than 97 per cent of all business entities in the Middle East are SMEs, they are largely underserved by traditional financial institutions,” Ludwig Ensthaler, General Partner at 468 Capital, said.

Alaan has partnered with multiple issuers in several countries across the region to be able to issue corporate cards and open banking players for seamless invoice payments.

While in stealth mode over the last six months, Alaan built the product and finalised partnerships with regulated financial institutions to enable product launch.

“We founded Alaan after experiencing first-hand the frustrating expense and invoice management processes. We have solved critical pain points in the end-to-end payment flow by building a software layer on top of the regulated banking infrastructure,” Karun Kurien, Co-founder and Head of Product & Technology of Alaan, said.