Thndr for financial investments says it adopts an ambitious plan to expand in the Arabian Gulf this year. It is getting ready to start operations in the Saudi market early next year, in addition to studying the possibility of expanding in the UAE market.
Ahmed Hamouda, co-founder and CEO of Thndr Securities Brokerage, revealed that his company applied to obtain the necessary approvals from the Saudi regulatory authorities in order to start its operations there. The electronic application is currently under review. Thndr also seeks to provide technical and financial research services during the coming period.
Hammouda explained that his company is currently considering expanding in the UAE market, and will apply to obtain a licence in the Abu Dhabi market, provided that it begins its operations in Emirates before the end of this year.
Thndr’s CEO stressed that expanding in the Gulf mainly targets benefitting from the strong momentum in the markets there, especially that the Saudi market is witnessing a wave of proposals at a fast pace.
Hammouda revealed that his company also wants to expand the provision of bond trading services, as it is considered a safe form of investment that comes with minimal to no risks, and a large investment return. Thndr has already applied to obtain the licence, and has started dialogues with a number of banks to provide the service on its app.
Moreover, the company’s business model is based on creating the culture of saving a part of its proceeds then creating investment channels for them, whether in stocks or investment funds.
Thndr is also working to increase the investment tools that its clients can choose from; by creating the so-called “investment supermarket” where all investment vessels are available and trading in stocks is allowed.
It will also provide a package of funds, especially the gold fund that was launched in partnership between Evolve Holding and Azimut Egypt under the name “AZ Gold”, along with a variety of other investment funds.
Additionally, Thndr provides a number of investment funds, including Sharia-compliant funds, a main index tracker fund, and equity investment funds.
The company plans to start providing technical and financial research services and stock recommendations in September through Thndr’s application in order to provide broader services to clients. Moreover, it is preparing the documents necessary to apply to obtain a financial technology licence.
Since Thndr was established in 2020, the application and technological infrastructure has been provided with systems that comply with the authority’s requirements for technological platforms, which makes all its e-services safe and secure.
He explained that the “know your customer” e-identification technology is more accurate than the manual way, because there is no error rate in the e-customer identification processes, in addition to the ease of procedures through technological platforms.
In mid-July, the Board of Directors of the Egyptian Financial Regulatory Authority (FRA) issued a package of executive decisions to activate Law No. 5 of 2022 regarding the regulation and development of the use of financial technology in non-banking financial activities, namely Resolutions 139, 140 and 141. That would pave the way for a new era in the non-banking financial sector using financial technology to achieve financial inclusion.
Hammouda pointed out that the Authority’s current legislation works to achieve the goal of financial inclusion and improve the standard of living.
Hammouda added that the authority’s decision paves the way for the market to provide fast and easy services for all groups of clients. It tackles all aspects, from the infrastructure to the stage where services reach contractors and service providers. It did not overlook the risks, nor the requirements for activation.
He added that the Egyptian people usually prefer one of three types of investment: bank certificates, real estate, or gold, as they are risk-free investment tools.
Consequently, Thndr seeks to provide a tool for its clients to help them invest in real estate through real estate funds that Thndr will add to its platform.
According to Hammouda, the company was able to reach the break-even point and achieve profitability about a year ago. It closed a funding round of $22m last February.
Hammouda pointed out that undertaking a financing round at this point requires a company with strong performance and operations, in light of the reluctance of venture capital investors to invest in startups.
Hammouda added that the Federal Central Bank’s raising of interest rates is somewhat an obstacle in financing capital for foreign investors to direct investment in dollars, especially with investors looking for other investment alternatives, including US treasury bonds.
The company aims to maintain its presence among the top 10 companies by increasing individual transactions, as it made 500,000 transactions by the end of June. In addition, the application was downloaded by nearly 500,000 customers.
He added that the fact that over 50% of the application’s customers are from outside Alexandria and Cairo is very important. 86% of those who were coded on the stock exchange last year were through Thndr.
He pointed out that those who coded during the first half of this year are more than those who were coded through Thndr in the entire last year, reaching a number of 150,000 and a market share three times more than companies that rank after Thndr in the trading order.
He added that the growth rate of implementations on the application increases by 10 times every year, and the rate of operations last year reached about 30,000 operations per month, and 300,000 operations in January. Then, it increased to over 500,000 in June.
Hammouda added that the company is in regular contact with the Stock Exchange to ensure that the structure accommodates the number of investors. And despite not setting a specific target for transactions, it is likely that one million transactions will be completed a month by the end of this current year, compared to one million transactions carried out last year.
He explained that the main goal of the company on which it was built is two basics: “increasing the culture of investment awareness with how to manage your money,” stressing that Thunder’s expansion plan is based on becoming an integrated financial services provider and not an investment bank, explaining that the plan could include adding non-financial activities. Banking is at a later stage, and the beginning will be through consumer financing activity.
Hammouda believes that Egypt needs to activate the Egyptian Stock Exchange in order to support and protect its economy, pointing out that the stock market’s contribution to GDP is 16%, compared to more than 100% in 2007.
He pointed out that the stock market value of the domestic product is only about 16%, while in 2007 it was over 100%.
Hammouda stressed that the revitalization of the stock exchange mainly requires strong offerings from the public and private sector, similar to the “e-finance” offering, explaining that Gulf markets are witnessing a high momentum in offerings, as the Saudi market recorded about 22 offerings in 2022.