Careem remains one of the Middle East’s biggest success stories, inspiring a legion of entrepreneurs and generating one of the biggest startup “mafias” in the region. Since its acquisition by Uber in 2019, the company has expanded its focus away from its core of mobility, to becoming a super app, a strategy that was launched in 2020 with a $50 million investment plan. 

At the time of the launch, Careem co-founder and CEO Mudassir Sheikha explained that its super app provides three main services - “the mobility of people, the mobility of things and the mobility of money”.

It is the money aspect where the company has really directed its resources, amping up its fintech offerings to become a serious player in the sector. It recently overcame one of its major hurdles - opening up its closed loop wallet after gaining regulatory approval from the Central Bank in the UAE. Since April this year, users on the platform have been able to make peer-to-peer (P2P) transactions through its Careem Pay digital wallet using a phone number, personal QR code or payment link, all with the ability to cash out. 

“People have been using it for really creative use-cases - parents collecting funds for class activities, people splitting meals, splitting rent, freelancers and service providers are using it,” says Madiha Sattar, vice president of Careem Pay. “This is a product we will invest in, it is a user acquisition product and a frequency driver.”

The company has tested out a great deal of Careem Pay services on its own drivers, also known as captains and most recently introduced a remittance corridor between the UAE and Pakistan in partnership with Lulu Exchange with more corridors due to be added.

“[The captains] are a great audience, the vast majority are Pakistani and remittances are very important. We’ve started paying captains directly into their Careem Pay wallets and from there they can pay their bills, do remittances,” says Sattar. The next step for Careem Pay will likely be other financial services for its captains including micro-lending, vehicle insurance and salary advances. 

Beyond money transfer, Careem also offers bill payment, grocery delivery and car rental among other services, payment of which the company hopes will be made primarily through the Careem Pay wallet. 

“Over time, if you’re leaving money in the wallet, you’re more likely to spend it on the Careem platform, we still need to drive home the message around Careem Pay, simplifying the use case and driving that user adoption through improvement in the user experience,” says Sattar. 

Frequency of use is crucial to the success of super apps which tend to be underpinned by social networking, logistics and payments. Once an app has enough traction and services, its next step is to include third-party services onto its platform, bringing them into its own ecosystem. It is a way of providing an ecosystem within the internet that offers a variety of services that work seamlessly together to offer convenience to its users with a single log-in and profile. Super apps like China’s WeChat and Alipay and Indonesia’s Gojek enable its users to communicate, consume content, order their groceries and dinners as well as apply for mortgages and transfer money to peers.

“When we launched the super app, we found we had a couple of interesting learnings from benchmarking global super apps. Typically, they have some cross-engagement driver - some of it is social, chat and payments,” says Sattar. “Of those three, payments is most adjacent for our services, there is a transaction happening. There is a lot you need to build to support payments, from integration with payment gateways, deals to negotiate to reduce fees, accepting cash, digital payments, we were sitting on years of infrastructure and experience to collect payments and that felt a lot more adjacent to us than chat or a social play.”

One in three customers in the UAE pay at least one of their monthly bills through Careem Pay and the platform processes more than $10 million in bill payments and top-ups per month. The wallet is one of its fastest growing segments, after ride-hailing and food delivery and is now looking to make its super app more relevant and personalised in the near future. 

“Right now, we do user segmentation, but it is not super sophisticated. You might see a new food delivery offer for someone who has never used it, that level of segmentation we’re doing, but the amount of data we’re sitting on, there is a lot of customisation we can do,” says Sattar.

While the UAE remains its biggest market, especially for its super app, Careem will be increasing its focus to Saudi Arabia, where the country’s new open banking legislations “will make it easier to bring down [its] costs” according to Sattar. 

“We need to be prudent and careful on how and where we spend our resources. We will start with Saudi Arabia and try to replicate the success we have in the UAE. We have learned with Careem Pay that partnerships are so important for financial services, it’s not easy to pull off bank partnerships, it requires a lot of resourcing, time and senior level engagement,” she says. 

It is this bargaining and negotiating power that Careem is relying on to attract more third party service providers onto its platform. 

“We don’t think everyone should go through the pain we went through. We want to use that to empower the community, we have negotiated down rates with the gateways, we can pass on some of those benefits,” adds Sattar.

One criticism that super apps commonly face is the eventual risk of monopoly, particularly when it comes to access to markets and customers, creating a ring fence for other startups who will not be able to compete with those on the platform. In response, Sattar believes the platform can be open to all. 

“Why should everyone have to build this from scratch - logistics, addresses, payments - this is something Careem can monetise, even if you live outside the super app, you should be able to leverage and use those services,” she says.