Nigeria’s fintech industry is not only buzzing with innovative solutions, it is changing how we live and do business. One of such innovative solutions is Social Lender. Social Lender is a lending solution that provides loans to individuals based on their social reputation. Bincom ICT solutions is the mother company of Social Lender.
Faith History spoke with Bade Adesemowo, Co-founder & CTO (Chief Technology Officer) at Social Lender, listen to the interview here. Bade Adesemowo is a techie who started off with website development seventeen years ago. He handles software development and everything technology at Social Lender. The CEO (Chief Executive Officer), Faith Adesemowo, has an investment banking background.
Social Lender: Here’s A Brief Background About The Startup
Social Lender piloted its product in 2014 with Sterling Bank. However, the startup officially launched in Nigeria in January 2015. After successfully testing and validating the solution, Sterling Bank took it live. The pilot was crucial as there was no similar solution at the time in Nigeria.
While Sterling Bank currently provides the funds in Nigeria, the startup has gone on to launch in South Africa. It launched in South Africa through Barclays Bank (ABSA Bank). The organization is looking to launch in Ghana in the nearest future. It is however worthy of note that the funds in Nigeria are not only available to Sterling Bank account holders. Non account-holders can also receive the loans. This was initially impossible in the first year the product launched.
Social Lender: Loans Are Given Based On Social Reputation
Social Lender helps banks lend money to people based on their social reputation. This includes social media footprint, mobile reputation etc. The social reputation score is not only based on an individual’s social profile. It also assesses the profile of a user’s social guarantor. The premise for the startup is the fact that every individual has a digital footprint. This is available either on social media or via your telephone contacts. This implies that reputation score is available for individuals who do not have a social media account.
The startup provides the technology that enables banks assess an individual’s social reputation. The individual can then use the reputation to borrow money from banks. Individuals can get a maximum of 100,000 Naira ($277) using their social reputation score. Once a social audit has been conducted, the loan will be paid into the users bank account within ten minutes. The organization is looking to increase the funds to up to 1 million in a few years’ time. One important fact Mr. Adesemowo mentioned (in this interview) was that the platform has a bad debt ratio of 4%. This is in comparison to the average of 10% – 20% in Nigeria. Essentially more than 95% of borrowers are paying up their loans. This proves that the algorithm works.
Social Lender: Here’s Why The Solution Is Very Important
The startup’s solution caters to more than 50% of adult Nigerians who lack access to credit. It provides a means to prove their credit worthiness which is one of the barriers to accessing funds. People use the loans from Social Lender for emergency needs, small scale business capital etc. This has a ripple effect as it goes on to increase economic prosperity.
The startup is also set to launch its USSD platform with its eyes set on low-income earners. It recently signed a partnership with CGAP (Consultative Group to Assist the Poor). The partnership will involve exploring how social data can predict the loan repayment behavior of low-income earners. The pilot program will also provide loans to low-income earners. Feature phone users will also be able to apply for these loans via Social Lender’s USSD platform. You can learn more about the partnership here. Click here to begin the process of getting a loan.
Do listen to the full interview with Bade Adesemowo here. Kindly let us know your thoughts in the comments.