Ebene News – AU – With over 13 million users, Nigeria-based FairMoney wants to repeat growth in India – TechCrunch – Fior Reports

Over 17 billion people are underbanked globally, most of them from emerging markets For them, getting loans can be difficult, and it’s a problem that fintech companies attempt to solve One way to do this is to promote financial inclusion by securing credit through a proprietary algorithm

One such company is FairMoney, which describes itself as “the mobile banking revolution for emerging markets” FairMoney, founded by Laurin Hainy, Matthieu Gendreau and Nicolas Berthozat, is a licensed online lender that provides instant loans and bill payments to underserved consumers in emerging markets.

Three years after launching cell phone lending service in Nigeria, the company opened a store in India, Asia’s second most populous country in August 2020

Prior to the expansion, FairMoney had experienced explosive growth in Nigeria in terms of NoFirst year loan disbursements, disbursed a total loan volume of $ 93 million, an increase of 128% over 2019 and impressive growth of 3,189% from its first year in 2018 As it stands, the company expects loan disbursements of $ 140 million by the end of the year From 2021

“I think we may have spent 25-30% more than some of our competition and I think we are the market leaders,” Hainy, CEO of the company, told TechCrunch But compared to the banks tradition, it was the seventh digital financial service provider in this field

FairMoney has come a long way since its launch in Nigeria in 2017 In its first year the company had just over 100,000 users Now it claims to have 13 million unique users with over 65 million loan applications FairMoney offers loans ranging from JPY 1,500 ($ 3.30) to JPY 500,000 (US $ 111000) with the longest loan facility period at 12 months Annual percentage rates drop from 30% to 260% – and Hainy says high annual percentage rate is due to high default rates in Nigeria However, FairMoney also claims NPL ratio is less than 10%

According to CEO, data-driven insight prompted choice to expand to India Indian market is very similar to Nigeria In Asian country, only 36% of adults have access to credit, leaving an untapped market of around 141 million people unserved by microfinance banks But unlike Nigeria, India has a better lending business unit and a friendlier regulatory environment

“If our ambition is to create a leading mobile banking for emerging markets, we have to start with really big markets,” said Heaney “We tested our products in 10 different markets to verify things like economics of yield, nonperforming loans, cost of risk, cost of customer acquisition, cost of infrastructure and India”

After expanding six months ago, FairMoney claims to have processed over half a million loan requests from over 100,000 unique users This number drops to 5,000-6,000 loan requests per day with an annual percentage rate of 12-36% Hainy says the company has achieved this without spending on advertising or marketing

Due to the logistical cumbersome behind international expansion, it is difficult for an African startup to expand beyond the shores of the continent Although this task is rare, two startups took on the task Last year , Nigerian fintech Paga with 15 million users and a network of over 24,000 agents has acquired Ethiopian software company Apposit to accelerate its expansion in Ethiopia and Mexico

FairMoney is also on the same path With more than 100 employees spread across Nigeria, France and Latvia, the company hopes to create an engineering and marketing team in India

Last month he hired the services of Rohan Khara to become a product manager (CPO) and facilitate his expansion Khara was the former product manager for financial services of the Indonesian super app Gojek and held positions management at Microsoft, Quikr and MobiKwik With Khara’s rich experience in creating consumer products in major emerging markets – India and Indonesia – Hainy says FairMoney is poised for explosive growth in Nigeria and India

“We share the vision that financial services in emerging markets need to be reformed, and for us, Rohan brings the expertise to see the FairMoney metric from roughly 1 million users to 10 or 20 million. ‘users “

Born in Germany to a Nigerian father and German mother, Hainy began his entrepreneurial journey in 2015 by setting up a food delivery company in Sweden Seven months later, he founded Le Studio VC, a start-up studio in Paris and a fund of 15 million euros that he managed as CEO for three years

“After these three years, I realized that being an investor was not yet suitable for me I felt very young and wanted to build something myself “

New banks like Revolut in the UK and N26 in Germany flourished across Europe Hainy wanted to start one for Nigeria after noticing how many people did not have access to affordable financial services during the visit

Despite studying other new banking models, Hainy and his team were unable to replicate them in a developing market like Nigeria Nigerian banks were still under credit due to the rigorous methodology of ‘loan allocation used Sensing an opportunity, they launched FairMoney as a new bank leveraging the credit first model Like Nubank in Brazil, FairMoney began providing loans to solve the problem of access to credit But its larger vision is not just a digital bank, but also a commercial bank

The company is working on obtaining a microfinance banking license to operate as before in Nigeria However, according to the CEO, the commercial banking license will take longer, perhaps five to ten years

“Over the next five to ten years I would like to believe that two of Nigeria’s top five commercial banks will be new. We want FairMoney to be one of them

The Lagos and Paris-based company raised $ 11 million from Series A in 2019 Between now and when it gets a commercial banking license, Hainy says the company has increased its Series B tour to go on a mission

After India, which emerging markets will FairMoney expand into the next market? CEO says nothing is on the horizon right now The company plans to move from a credit-based value proposition to a full-fledged financial services provider, deepening its segments and replicating the growth of the Nigeria in India now

Nigeria, FinTech, India, TechCrunch, 1,000,000

Ebene News – UA – With over 13 million users, Nigeria-based FairMoney wants to repeat its growth in India – TechCrunch – Fior Reports

Source: https://fiorreports.com/index.php/2021/02/18/with-over-1-3-million-users-nigeria-based-fairmoney-wants-to-repeat-growth-in-india-techcrunch/