In a recent interview, Damilare Odueso, Co-founder of Crendly, shared insights on how Crendly is transforming credit access in Nigeria. Here’s a summary of the key points:
Improving Credit Access
Crendly uses alternative data like payment history and social media activity to assess creditworthiness, enabling loans for those without traditional credit histories.
Current Challenges
Credit access in Nigeria is limited, especially for small businesses and individuals lacking formal credit histories. Traditional banks require extensive documentation and collateral, hindering economic growth.
Importance of Financial Inclusion
Financial inclusion is crucial for economic growth. It allows more people to invest in education, healthcare, and businesses, driving overall development. Lack of financial inclusion worsens poverty and limits opportunities.
Initiatives for Improvement
The Central Bank of Nigeria (CBN) has introduced policies to encourage lending to underserved segments. Mobile money services and fintech companies also play significant roles in reaching the unbanked population. However, challenges remain.
Technological Advancements
Technology, including mobile tech, data analytics, and AI, supports character-based lending by enabling accurate and efficient credit assessments. This technological shift is essential for expanding credit access and financial inclusion.
Advice for Policymakers and Financial Institutions
Odueso advises policymakers to support fintech innovations and create a conducive regulatory environment. Financial institutions should adopt inclusive credit assessment methods and leverage technology to reach underserved populations. Collaboration between the government, financial institutions, and fintech companies is key to enhancing credit access and financial inclusion.
Conclusion
Crendly’s innovative approach demonstrates the potential of technology to transform Nigeria’s credit landscape, making financial services accessible to all and fostering economic growth.