Finca and First Access join forces for microfinance fintech
Finca partners with First Access for the world’s largest microfinance fintech initiative
Microfinance organisation Finca and credit scoring specialist First Access have unveiled “the world’s largest microfinance fintech collaboration”.
The two companies say this partnership “will create the largest and most sophisticated alternative credit-scoring approach by a microfinance institution (MFI) in the world.”
It will also vastly improve Finca’s outreach to excluded populations.
First Access will analyse existing client data from Finca’s operations, as well as subscriber data from local mobile network operators, to establish credit scores for low-income clients who lack sufficient formal credit history to secure small loans for personal or business needs.
The pilot country is Tanzania. By the end of 2016, the venture will be operational in six African countries where Finca is present (in addition to Tanzania). These are Kenya, Zambia, Democratic Republic of Congo, Uganda, Malawi and Nigeria.
Andree Simon, Co-CEO of Finca Microfinance Holding Company, comments that this project will provide Finca “with more objective information to form a credit decision and more time to improve the quality of our relationship with our clients”.
She adds that it should “minimise the risk of our overall portfolio, lower underwriting costs, increase the speed of loan decisions, expand the pool of eligible borrowers and ensure they get the guidance they need to borrow safely and successfully”.
Finca’s worldwide network of MFIs serves 1.8 million people in 23 countries. Its majority shareholder is Finca International, a non-profit organisation based in Washington DC (US).
Elsewhere, Finca’s banking subsidiary in Georgia is looking to modernise its digital banking systems.
