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The opportunity to build a Jar-like digital gold investment platform for Pakistan
Gold has been one of the best-performing assets over the last few years but it is hardly considered a saving option by an average millennial in Pakistan due to storage issues.
You don't want to keep it at home and bank lockers are also not 100 percent safe these days. Buying and selling it is also a hassle.
If there was an option to buy and sell gold digitally and have a third-party store it for you, it could be a great (long-term) saving option for a very large number of people who want to save money by investing in small amounts.
An average user in Pakistan doesn't understand stocks, bonds, and mutual funds. There are only 250,000 registered stock investors in Pakistan (and probably another 250,000 investing in mutual funds).
An average Pakistani (who has some means to save little money from their monthly income) waits to save enough to invest in real estate or keeps their money in a bank account (sometimes without even realizing that it is losing 10-15 percent of its value every year).
There's an opportunity here to create a product that helps users save in digital gold. Jar is doing this in India. It is one of my favorite fintechs to come out of South Asia. But they've been able to do it with the help of a partner platform, Safegold, that enables users to buy and sell gold digitally and then store it on their behalf.
If you do this in Pakistan, you'll have to build the underlying infrastructure as well. There's no Safegold here.
Jar started with gold about a year ago and has been able to acquire over 9 million users until now - with 200K+ daily transactions. And now they're preparing to introduce other financial products on their app, including mutual funds and lending.
I love the following comment by their co-founder on how they're different from legacy players.
"Manufacturing a product is one thing and being able to sell it is another. All these institutions [legacy banks and mutual funds] are good at manufacturing. For selling, you have to be aligned with the individual’s persona, idiosyncrasies, insecurities, cognitive load and the cultural significance. That’s an art and science by itself."