SC Ventures, Standard Chartered's innovation, fintech investment and ventures arm, has entered into a memorandum of understanding (MoU) with Yabx, a firm aiming to enable the underserved with limited credit history to get fair access to financial services tailored to their needs.
As Yabx points out, mobile technology plays a key role in this partnership. Africa has over 700 million mobile wallets, and about 450 million bank accounts but access to formal credit remains constrained due to poor credit infrastructure and the slowly evolving risk appetite of financial services players, especially traditional banks.
However, the company says, the Covid-19 pandemic has accelerated digitization in the financial sector and created a fertile environment for new and disruptive products to be taken to the market. The partnership between SC Ventures and Yabx is leveraging this to create what the companies describe as unique, Africa-specific products that will increase access to credit for the underbanked across Africa.
Nimble future-ready technology and data analytics combined with a deep understanding of banking will, say the partners, reduce the cost of delivery of innovative credit products, thereby widening inclusion across underserved segments in Africa where it is needed most.
Given the scale and the complexity of the opportunity, SC Ventures and Yabx have taken a collaborative approach to jointly address the challenge. Loans will be provided to customers for specific purposes like education and skill development using an innovative data-driven scoring and analytics engine that has been built with rich experience from African markets.
These loan products will be initially launched in Uganda and then subsequently expanded to other countries in Africa.