A mobile platform that works with saving and credit unions in Kenya will receive mentorship and support from Barclays Africa in a move to promote innovation and growth in financial services.
iNuka Pap is one of 10 start-ups that will benefit from Barclays’ programme, which is run in partnership with TechStars and attracted over 450 entries from 45 countries.
Through iNuka Pap, members of saving and credit co-operatives (SACCOs) can gain access to loans using a mobile wallet. The initiative aims to address the lengthy process required when SACCO members apply for loans. To gain access to funding, users register as members of iNuka Pap, the Kenyan Credit Reference Bureau then processes past loan information and automatically generates a credit score.
The user automatically receives a text telling them if they have qualified for a loan and how much they can get. They can then request the loan and receive it straightaway through iNuka Pap’s mobile platform – fitting in with the trend among Kenyans to use mobile money on a daily basis.
Users can access micro credit on their mobile wallet, which is fully deductible from their salary. Employees can also provide access to insurance for their workers and their families for the equivalent of $0.03 a day. iNuka Pap makes a commission from insurance and earns an interest on the micro loans.
The founder of the project aims to change the country’s culture and make people deposit all of their savings with co-ops. Due to the lengthy process sometimes required to obtain loans, people in Kenya tend to split savings, with half going to the co-op, and half staying under mattresses in case of emergency.
Lack of insurance is another issue affecting the country’s working adults, with only 4% of employers offering insurance.
iNuka Pap chief executive Waweru Kuria he hopes that by next year they will have reached 100,000 people.
The country has around 10 million people in the low-income sector who often require urgent access to loans.
According to the African Economic Research Consortium (AERC), 98% of Kenyans have access to a mobile phone, and 75% of them are using mobile money every day.
Dozens of mobile money systems have been launched in recent years in Kenya. Mobile phone banking started taking off in Kenya in 2007 with the launch of M-PESA. By 2013, 43% of the country’s GDP was flowing through the platform, helped by the high rates of sending money via other methods and the risks involved in transporting cash.