Regardless of how persuasive loan advertisements are, getting credit in Uganda is one complicated hustle; more so for those in the informal sector – who happen to be the huge majority.
When one visits a formal financial institution, the paperwork, waiting time and costs involved to process a loan become a huge turn-off. This forces many to turn to loan sharks who have outrageous conditions; despite having instant cash.
Many ask those seeking credit to sign off their collateral security as sale agreements with a mutual understanding that when the loan is repaid, the sale agreement will become null and void. This particularly leaves those seeking credit between a rock and a hard place.
Nevertheless, there are digital solutions that are closing this credit gap. One of those organizations that is revolutionizing and democratizing credit is Card Pesa.
Card Pesa is a tier-four Non-Deposit Taking Microfinance Institution that uses online and cellular platforms to provide small working capital and emergency loans.
The Card Pesa platform is built to use Unstructured Supplementary Service Data (USSD) and online applications to deliver credit to you wherever you are for as long as you can connect to a telecom network. It is automated and therefore service time from the point you request for credit to the point you receive the credit is a matter of seconds.
The solution enables people access collateral-free working capital loans instantaneously to invest in their businesses so as to maintain or increase their earnings. It also provides personal emergency loans to its subscribers.
Instead of asking for physical collateral, CardPesa assesses the borrower’s creditworthiness and loan limits using five Cs – the borrower’s character, capacity, capital, available conditions in the environment and collateral – which in this case is in form of one’s biodata, references and one’s business or workplace.
According to Victoria Birungi, the Card Pesa Head of Operations, the company is committed to funding everyone’s hustle for as long as you prove that you are involved in a profitable activity, need money and have the capacity to repay.
“We are extending loans for business and emergency services to different types of people. To get started, you are required to sign up to the platform by visiting www.cardpesa.com/signup. After signing up, our team gets in touch with you and your submitted references to confirm that the information you have given us is actually correct. Depending on how responsive you are, you will be able to access funds within 48 hours,” Birungi said;
She added: “At the end of the day, all the steps you go through help find out that you are involved in an economic activity so that we are able to fund your hustle.”
Basing on one’s credit history on the platform, their limits can be increased to millions and even given better service plus longer repayment periods. To provide the loan service, Card Pesa integrated into Airtel Money, MoMo Pay and banks to easily provide instant credit to its clients.
Card Pesa is the third participant to be showcased in the 2022 40 Days 40 FinTechs initiative.
Now in its third edition, #40Days40FinTechs has quickly grown into one of the world’s premier showcase events for the innovations that are enabling ever more people to join the digital economy space. That is surely going to remain the case, in large part due to the inspiration and collaboration that our partners; Level One Project, Mojaloop, ModusBox, and Crosslake Technologies generate, but mostly because of the continuing, generous support of the Gates Foundation.
Digital Innovators and FinTechs around East Africa should be more eager to embrace 40 Days 40 FinTechs as Season three will cover physical destinations in Uganda, Kenya, Tanzania, Burundi and Rwanda.
Run under HiPipo’s Include Everyone program that also encompasses other initiatives such as FinTech Landscape Exhibition, Women in FinTech Hackathon, Summit & Incubator and the Digital and Financial Inclusion Summit and Digital Impact Awards Africa; the #40Days40FinTechs platform aptly provides a setting for the various players and stakeholders involved in digital and financial technology to exhibit their products & Services and also share their ideas on how more of us, especially those unserved and underserved by the present financial systems, can be brought into the fold.
The 40 Days 40 FinTechs initiative offers participants useful tools and an introduction to industry’s emerging technologies, such as Mojaloop Open Source Software, and guidance from Level One Project foundational material. The skills gained from this initiative cover Level One Project Principles, Instant and Inclusive Payment Systems (IIPS), Inclusive Finance and FinTech in general.
According to HiPipo CEO Innocent Kawooya, this year’s edition will cement achievements of the previous editions – where over 60 FinTechs have been transformed – but also build on them to leverage digital financial inclusion in East Africa and beyond. “As HiPipo, our extensive effort and advocacy is partly for the intention of championing digital innovation and interoperable instant and inclusive payment systems (IIPS) in Africa to a point where our innovators enjoy and achieve sound profit margins to help them keep designing and deploying affordable and inclusive financial services for the poor,” Kawooya said.