Faith Adesemowo: Building social network for trust, credit and access to financial services
With almost a decade of professional experience in finance and financial technology Faith Adesemowo, the CEO and co-founder of Social Lender, a Fintech solution that helps financial institutions to offer financial services based on social reputation to individuals who are unbanked, underbanked or have little or no access to formal credit is one of the industry leaders that is driving financial inclusion expansion in not only Nigeria and South Africa.
As an emerging markets leader with a focus on innovation, Adesemowo has in the last four years of chairing Social Lender developed solutions that have helped to bridge the gap of immediate fund access for many Africans with limited access to formal credit.
From starting her professional career as an analyst at BGL PLc, one of Africa’s foremost investment banking companies some 12 years ago, Adesemowo worked her way to lead a department as the Group head, professional service at Bincom ICT solution, a Nigerian ICT Solutions firm before becoming the CEO of Social Lender in 2015.
With over 50 percent of African adults lacking access to formal financial services, Social Lender is striving to bridge the gap by helping financial institutions to offer financial services based on social reputation to individuals who are either underbanked or are financially excluded.
The technology-driven company is designed to bridge the gap of immediate fund access for people with limited access to formal financial services using its own proprietary algorithm which performs a social audit on users through social media, online, communities and other related platforms upon which it is able to give a Social Reputation Score to each user.
Financial Services are guaranteed by the user’s social profile and network allowing users to then borrow from banks and other financial institutions based on their social reputation.
Beyond financial measures, Social Lender’s traction can be quantified by the number of people impacted by the inclusive nature of its innovation. For example in Nigeria, Social Lender has built a network of Ambassadors and Local Guides who provide offline guidance to the financially excluded, deliver financial literacy and education.
Social Lender solution is now available to a vast majority of End-users who lack access to the internet and do not have a smartphone. They access the technology using SMS & USSD channels on their feature phones with the guidance of Social LenderAmbassadors. The outcome of which is improved lives for individuals in the local communities using Social Lender’s technology.
In a country like Nigeria where more than 40 million adult population are without bank accounts with lack of identity posing as one of the barriers to financial inclusion, a solution like Social Lender that is driven by technology and mobile phone can not only give access to financially excluded but can also enable access to bank credit.
The provision of identification and other relevant documents are the bedrock for onboarding a customer in Nigerian banks. The lack of such requirements means that the unbanked population would not be able to access credit as banks leverage on financial transactions to determine a customers’ creditworthiness.
As part of the Know Your Customer (KYC) and Customer Due Diligence (CDD) procedures as implemented by the Central Bank of Nigeria (CBN), Deposit Money Banks (DMB) in Nigeria are required by the regulator to obtain identification documents before opening an account for their customers.
Meanwhile, on January 2012, the central bank of Nigeria through its collaboration with industry stakeholders launched the National Financial Inclusion Strategy (NFIS) in which it projected that it will ensure 80 percent of Nigerian adult population are included into the financial cycle by the year 2020.
Latest figures by EFInA put Nigeria’s financial inclusion rate at 63.2percent, meaning that as much 36.8 percent adults still lack access. Meaning if the apex bank is going to achieve its 20 percent exclusion rate by year-end, it would have to bridge the current 16.8 percentage point exclusion gap.
While Nigeria depends largely on its Bank-led financial inclusion model, its African peers who have leverage technology and Telco has reported high inclusion rate than Africa’s most populous nation.
According to a report by the World Bank, mobile money drove financial inclusion in Sub-Saharan Africa.
Between 2014 and 2017, the Washington-based lender noted that there has been a significant increase in the use of mobile phones and the Internet to conduct financial transactions which contributed to a rise in the share of account owners sending or receiving payments digitally from 67 percent to 76 percent globally while developing countries recorded 57 percent to 70 percent.
While Kenya and Ghana have 60 percent and 40 percent mobile money service penetration rates Nigeria with an adult population that is higher than both Ghana and Kenya put together has1 percent.
However, industry experts have said that the telecommunication penetration rate in Nigeria at 86 percent with 182.7 million customers, the single largest customer base in the country holds growth potential for financial inclusion growth.
Under the leadership of Adesemowo, Social Lender has made it services accessible on multiple channels which include SMS, USSD and Web. Recently, Social Lender launched a USSD only channel in Nigeria targeting low-income communities. Also, customers of Social Lender both in Nigeria and South Africa can withdraw requested cash loans via existing banking channels including bank accounts and mobile money.
The Company has signed partnerships with 6 Financial Institutions in 2 Countries of Operations including Sterling Bank (Nigeria), Unity Bank (Nigeria) FCMB MFB (Nigeria) Absa Barclays Bank (South Africa), and iTrust (Nigeria) with a pipeline of 4 partners in 2 countries.
Meanwhile, the technology company is seeking to raise $1 million in equity, convertible note or impact investment to expand staffing, implement and integrate more technology interfaces, expand Social Lender’s social impact, brand and marketing reach, and to expand into new markets and countries of operation.
The company has the aim to provide end to end Lending solution for the underserved (using Social Reputation), it also plans to launch new value-based propositions through Strategic Partnership in various areas including Alternative Credit Scoring, API Integrations and so on.
According to Social Lender, its priority is to enable access to financial services for the target audience in Low Income / Developing Economies while driving financial inclusion and impacting the lives of its targeted demography (Unbanked & Underbanked).
It also wants to make Social Reputation Score as an alternative credit score to enable leasing of Agricultural Equipment for Small Holder Farmers and access to finance for agriculture Inputs while exploring
New Use Cases and Industry Verticals for the Social Reputation Score e.g: Insurance Score solution, KYC (Know your Customer) Solutions, Pension / Micro-Savings Solution, etc.
Whilst promoting diversity and encouraging more women in leadership, Adesemowo mentors individuals and is an advisor to several organisations. Faith has also founded two thriving startups specializing in delivering clean, eco-friendly and sustainable beauty products for women of colour.
Adesemowo is also an avid speaker and has gone on to win multiple awards for Social Lender. She’s passionate about Technology for Good as well as delivering Social Impact.