Double The Perks: Aramex's Partnership With FlapKap Aims To Empower The UAE's SME Sector Both Logistically And Financially This strategic partnership will enable SMEs to access working capital financing from FlapKap to meet their inventory, marketing, and operational needs, all while benefiting from Aramex's reliable logistics support.

Aramex, the UAE-headquartered global provider of logistics and transportation, has announced a partnership with Flapkap, a UAE-based revenue-based financial (RBF) platform that enables small and medium enterprise (SME) owners to access capital in as little as 48 hours without having to give up on equity or ownership.

Launched as part of Aramex's mission to better serve the nation's SME sector, the collaboration aims to support new and existing Aramex merchants, i.e. SMEs based in the UAE, to obtain fast and flexible funding within 48 hours.

While Aramex supports SMEs by offering comprehensive logistics and transportation services and thereby ensuring efficient supply chain management, FlapKap complements this by providing revenue-based financing solutions through its innovative app.

This partnership thus enables SMEs to access working capital financing from FlapKap to meet their inventory, marketing, and operational needs, all while benefiting from Aramex's reliable logistics support.

"By partnering with FlapKap, we are able to provide SMEs with tailored financial solutions and data-driven insights that optimize cash flow and operational efficiency," says Lour AlMukhaimer, Channel Manager – SMEs Commercial and Partnerships, Retail Outlets at Aramex. "This collaboration not only enhances the competitiveness of SMEs, but also reinforces Aramex's commitment to supporting the growth of small and medium-sized businesses by removing logistical and financial barriers. In doing so, we contribute to the broader goal of driving economic development and innovation across the regions we serve."

Lour AlMukhaimer, Channel Manager – SMEs Commercial and Partnerships, Retail Outlets, Aramex. Source: Aramex

Now, it is no secret that the SME industry in the UAE has made major strides to be at the forefront of the nation's most significant gross domestic product (GDP) contributors today. In fact, multiple reports have shown that SMEs contribute over 53% to the nation's non-oil GDP- a statistic that is mentioned in a 2023 report by the International Finance Corp (IFC).

However, the same IFC report also highlights what has long been quite a diabolical situation for the small and medium business owners: an SME credit gap in excess of US$260 billion in the MENA, with only 4% of outstanding loans in the UAE awarded to SMEs. It is precisely this glaring loophole that Aramex and FlapKap hope to address through synergizing their services.

"Over the last decade, SME businesses have undergone digital transformation and have had to adapt to the fast paced change," notes FlapKap's Chief Commercial Officer Kunal Harisinghani. "In this time, while corporates have been able to deploy disproportionate investments in tech innovation that also plays a large role in operational and logistical efficiencies, SMEs have had limited resources to be able to do so. This is something that the Aramex and FlapKap products inherently solve. Aramex has developed technology and logistical operations that allow SME businesses to have equal advantages as a corporate without the heavy investments, essentially utilizing ready tools or application programming interfaces (APIs) that connect to the tools that SMEs use. Similarly, FlapKap has leveraged the data that these SMEs created over the last decade, and using this data provides extremely fast and efficient working capital funding to further allow SMEs to grow and develop."

Indeed, FlapKap--which was founded in Egypt in 2022--has established itself as a beacon of financial support to SME merchants in the region by offering them non-dilutive funding, a form of working capital that doesn't require a startup founder to give up equity or ownership when receiving it, which is then repaid as a fixed percentage of the revenue they generate.

"FlapKap's very purpose of being is to provide SMEs an extremely fast and efficient source of funding," Harisinghani adds. "SMEs have not had equal access to financing as corporates and we are on a mission to change this. In 48 hours, we are able to utilize data and unlock funding for businesses that are worthy. Now, with the Aramex partnership, FlapKap aims to educate SME businesses about the value of managing working capital efficiently. Most SMEs do not have a dedicated finance team, and the entrepreneurs wear this hat in addition to several other hats. We want to be a support structure for these entrepreneurs on financial management. With this partnership, we also hope to reach more SMEs. Aramex has been the backbone for a large number of SMEs in the region, helping them scale with their logistics and last mile services."

Related: The State Of Play -And The Road Ahead- For Startups And Investment In The GCC

Kunal Harisinghani, Chief Commercial Officer, FlapKap. Source: FlapKap

While Aramex has been a name brand the logistics business for well over four decades now, since its inception in 1982, AlMukhaimer notes that there are still certain bottlenecks when it comes to efficiently serving the SME market's supply chain needs--a challenge that the company has gladly risen to.

"SMEs in the UAE often encounter specific logistical challenges, such as complexities in cross-border shipping, where managing customs regulations, documentation, and varying international shipping costs can be daunting," AlMukhaimer says. "Aramex addresses these issues by providing comprehensive solutions that streamline customs processes and offer competitive pricing, making international trade more accessible for SMEs. Additionally, SMEs often struggle with inventory management due to limited warehouse space and the need for faster restocking. Aramex's advanced warehousing and inventory solutions help SMEs optimize their storage and supply chain efficiency. Lastly, during peak seasons or special events, SMEs may find it difficult to scale operations due to limited resources. Aramex supports these businesses by offering flexible logistics services that can quickly adapt to fluctuating demands, ensuring they can meet customer expectations without overstretching their capabilities. Through these partnerships, Aramex empowers SMEs to overcome these challenges and focus on growth."

Moving forward, this strategic partnership will thus enable SMEs to access working capital financing from FlapKap to meet their inventory, marketing, and operational needs, all while benefiting from Aramex's reliable logistics support- a combined approach that both entities believe can help SMEs scale beyond the UAE as well.

"FlapKap and Aramex have come together to support entrepreneurs to expand to other parts of the GCC with a combination of logistics and funding combined," Harisinghani declares. "Most SME businesses are looking to build in the UAE and serve the larger GCC markets. We therefore want to be the foundation using which businesses are able to solve two of these largest challenges--logistics and funding--when it comes to regional expansion."