Yvonne Johnson - CEO at Indicina
Africa’s massive consumer credit opportunity requires technology and credit risk innovation that most lenders currently don’t have,” says Yvonne Johnson, CEO at Indicina. [ Photo / Business Today ]

Sub-Saharan Africa’s largest fintech investment fund – GreenHouse Capital – has invested in Indicina, an innovative and solution driven fintech startup that creates a hassle-free lending process through its banking-as-a-service technology.

GreenHouse Capital has for years invested in promising fintech and fintech-enabled startups. Indicina’s solution-based approach bridges a major gap in Africa’s credit infrastructure. Access to credit is a big problem in Africa and Indicina is building the infrastructure to unlock it.

“Only 17% of African banking customers have consumer loans – less than half of those with a transaction product. This massive consumer credit opportunity requires technology and credit risk innovation that most lenders currently don’t have,” says Ms Yvonne Johnson, CEO at Indicina.

Indicina’s platform optimizes analysis and decision making for lending in Africa which makes the lending process easier and faster. It creates a massive opportunity to tap into Africa’s consumer credit potential. “The market opportunity is driven by both regulation and improved financial technology. Central banks in many African countries, for example Egypt and Nigeria, have recently introduced regulation that mandates a minimum ratio of consumer loans (individual retail and SME) to the total loan portfolio,” says Ms Johnson.

IFC’s estimate of this opportunity is $300 billion (Ksh30 trillion). To capture the upside in consumer lending, she says, banks need a competitive digital offering backed by strong data and analytics capabilities for more efficient customer acquisition and risk assessment.

There have been blind spots in Africa’s credit sector especially for consumer lending due to lack of data, proper analysis and personnel which have limited the potential of the credit sector in the continent. Indicina solves the problem by providing alternative credit scoring and data needed for quick decision making, thus accelerating the process of financial inclusion.

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Banks have typically focused on the corporate lending space because of the risk profile and ease of execution. Consumer loans issuance requires a different type of risk management skills, different from what banks have developed over decades.

“Distribution is a key consideration in consumer loans and in order to reach a good scale, technology has to play a role in the distribution and speed of execution,” Ms Johnson says. “Our platform at Indicina tackles this problem by providing data in the necessary format to leverage it for analysis and decision making.”

Indicina’s key value proposition is to improve consistency of credit decisions and minimize bias from human underwriters; increase customer lifetime value; empower lenders to drive new uses of data beyond predicting default such as managing churn, marketing and campaigns and empower non-lender brands to expand offerings by embedding lending and related products.

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“We invested in Indicina because of its alternative credit scoring, risk assessment and quick decision-making on credit. Indicina presents a massive opportunity for the continent to accelerate financial inclusion and we are proud to be part of their story,” says Ruby Nimkar, Principal at GreenHouse Capital.

The Nigeria-based fund is an important component to the growth of Indicina because of the values they hold for a tech-enabled Africa as well as their expansive network and know-how.


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