FINCA Driving Financial Inclusion through its Digital Transformation
Finca Impact Finance’s (“FIF”) mission is to bring the financially “excluded” around the world into the financial system. As such, digital solutions have become increasingly important in order to achieve this objective. This is particularly important in FIF’s African markets (Uganda, Nigeria, Malawi, Tanzania, Zambia and the DRC) where income levels and transaction sizes are lower, and physical distances and poor infrastructure can make transactions more expensive. FIF’s other markets – such as those in markets Latin America, the Caribbean, Eurasia, the Middle East, and South Asia- are generally more developing.
In 2017, FIF successfully launched its HaloYako mobile savings product in Tanzania, the first of its kind in the country. HaloYako allows users to open an account and manage their savings goals and targets in a simple manner. More importantly, HaloYako doesn’t require a smart phone and can be accessed using simpler “feature” phones. Encouraging savings is a key mandate for responsible finance and FINCA, particularly in sub-Saharan Africa, where FINCA is looking to reverse a declining trend of savings. According to the Findex 2017 survey, only 43% of developing country adults saved in the 12 months prior to the survey. In 2014, that figure was 53%.
In the Democratic Republic of Congo (“DRC”), it’s largest market in sub-Saharan Africa, FIF has successfully deployed over 1,000 mobile point-of-sale (“POS”) devices that allow its vast agent network to increase the number of transactions processed as well as broaden the range of financial services offered. With integrated biometric identification capabilities, FIF DRC and its customers are well-secured in performing all transactions and requests. In addition to the POS, FIF DRC has successfully launched “Click”, its mobile banklet that allows for customers to open a FIF account within minutes and access instant credit, FIF products, as well as integrate their mobile wallets from various MNOs. In the DRC, as in other markets, the hub-and-spoke network of physical branches supported by an agent network and mobile financial services will allow for an exponential growth in market share.
The digitalization of FIF’s services will pave the way for FIF to achieve optimum operational efficiency, provide necessary scale to reduce the cost of services delivered to its client base, and build a seamless and standardized technology platform creating a uniform and improved user experience. Competition is not absent, with a two-pronged threat from new fintech driven entrants as well as banks broadening their business models. As such fintech is critical to FIF’s long-term mission and sustainability.