Madfu Secures $25.5M to Accelerate Interest-Free BNPL in Saudi Arabia

Saudi Arabia’s fintech scene is on a proper roll, and the latest sign of that momentum comes from Madfu, a homegrown Buy Now, Pay Later (BNPL) startup that has just secured SAR 95 million (around $25.5 million) in a Pre-Series A round. The investment was led by Afaq Capital, with participation from a group of angel investors, signalling growing confidence in interest-free, Sharia-compliant digital payments across the Kingdom.

Founded in 2022 by Abdullah Al‑Ibrahim, Ahmed Al‑Wusheel and Anas Al‑Shaqir, Madfu set out to offer something straightforward: split your purchase into instalments, pay no interest, and avoid hidden fees. Simple on paper, yes, but in reality, building that within a regulated framework is no small feat. The company operates under a licence from the Saudi Central Bank (SAMA), placing it firmly inside the Kingdom’s official fintech ecosystem.

Its core product allows consumers to divide payments into up to six instalments, giving shoppers breathing space while helping merchants boost conversion rates and customer loyalty. It’s one of those models that, when it works well, feels spot on for markets where digital adoption is racing ahead but consumers still value transparency and compliance with Islamic finance principles.

The fresh funding is expected to power Madfu’s next phase of expansion across Saudi Arabia. That means onboarding more merchants, strengthening partnerships across retail and services, and investing heavily in product and technology. In short, doubling down. The company has also indicated plans to roll out new Sharia‑aligned financial products tailored to shifting consumer expectations in an increasingly cashless economy.

From what’s been shared, a good chunk of the capital will go towards enhancing the technology stack — improving user experience, optimising transaction flows, and making integrations smoother for merchants. Anyone who has ever tried to integrate a payment solution knows it can be a bit of a faff, so streamlined infrastructure could make a real difference.

Saudi Arabia’s BNPL market has seen rapid uptake, driven by e-commerce growth and changing payment habits. Under Vision 2030, financial innovation is no longer a side project; it is central to economic diversification. And believe it or not, regulatory clarity has actually become one of the Kingdom’s quiet strengths in fintech. Startups like Madfu are benefitting from that structured environment, rather than working around it.

I’ve noticed, speaking with founders across the region over the years, that trust is everything in financial services. At Arageek, we often hear from early-stage entrepreneurs who say that credibility, especially regulatory backing, can make or break adoption in the first few months. Madfu’s positioning as both transparent and SAMA-licensed definately works in its favour.

That said, competition in BNPL is heating up across the Gulf. Madfu will need to keep pace not just with funding announcements but with execution, merchant coverage, user experience, and sustainable unit economics. On the flip side, its focus on interest-free, clearly structured payments gives it a differentiated lane in a crowded market.

With this latest round, Madfu appears determined to scale its footprint while contributing to the Kingdom’s broader digital payments infrastructure. If it manages to balance growth with compliance and customer trust, it could play a meaningful role in shaping the next chapter of Saudi fintech. And in a market moving this quickly, that’s no small ambition.

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