Africa’s credit infrastructure has fallen behind the rest of the world due to insufficient credit coverage from its bureaus
Picture of Yvonne Johnson: Photo Credit : Indicina
Indicina, a Nigerian firm, has secured $3 million to help businesses provide large-scale loans to their customers.
According to studies, Africa’s credit infrastructure has fallen behind the rest of the world due to insufficient credit coverage from its bureaus. In addition, there is a strong requirement to record credit transactions in Africa’s financial services. Access to credit in real time is becoming increasingly vital as Africa’s financial services grow more digital. They are promoting themselves as market choices.
As previously said, credit is an essential component of the acceptance of financial services in every country. However, while large corporations and high-net-worth people have no trouble getting loans from banks in Nigeria, the retail and SME segments are underserved.
While working as an executive with First Bank, one of Nigeria’s largest banks by assets, Yvonne Johnson couldn’t ignore her concerns. As digital banking, which includes the supply of loans, grew in popularity in the country, she saw an opportunity to launch Indicina in 2019 to provide credit rails and financial analytics tools for these firms, she told TechCrunch.
According to Ms Johnson , lenders can use Indicina for credit scoring, bank sentiment analysis, gaining access to machine learning-driven financial data and better insights into customers they don’t already have, as well as derisking unsecured loans.
She said another intriguing aspect of Indicina’s approach is that manual loan processors can use the platform to double or triple their volume without bloating their loan books.
“We’ve never had a balance sheet in our lives.” It’s never been about giving us credit. “We want to focus on the infrastructure layer and give solid infrastructure to make clients feel more comfortable,” Tech Crunch quoted CEO Johnson as saying .
“We want lenders to have more information about credit decisions so they can get their digital product to market faster. As a result, we’ve never had a business strategy that includes our balance sheet, with which we’ve always collaborated with lenders,” she said.
Target Global, a Berlin-based and pan-European venture capital firm, led the round, adding to its extensive line of Nigerian startup investments, which includes Kuda, Kippa, and Edukoya. Ricardo Schäefer, a partner of the business, will join Indicina’s board of directors. Greycroft and RV Ventures both participated in this round.
Target Global and Greycroft invested in Indicina because of its unique approach to solve Africa’s credit problem. Both firms sponsored Indicina because it uses data to tackle the loan eligibility problem that was previously determined by incomplete creditworthiness assessments, according to its partners, Schäefer and Will Szczerbiak, respectively.
Credit bureaus and open finance platforms are among the fintech’s partners. Indicina, which Johnson co-founded with CTO Jacob Ayokunle and chief data scientist Carlos del Carpio, has more than 120 customers, including banks, non-bank lenders, and fintechs, according to Johnson. Polaris Bank, LipaLater, VFD, Zilla, and CreditDirect are just a few. According to Indicina’s website, it has assisted these clients in processing over 3 billion dollars ($5 million) in loans from 10,000 bank statements and disbursed over 700 million dollars ($1.17 million).