Finance Indaba 2017: Alternative Circle is broadening the financial inclusion spotlight


"We believe that the user is the true source of value in any business, and if you service them well you can grow them and they in turn will grow your business," says Kevin Mutiso, CEO and co-founder of Alternative Circle, a silver partner at the Finance Indaba Africa 2017 on 12 and 13 October 2017 at the Sandton Convention Centre in Johannesburg. Finance professionals and accountants register for the Finance Indaba for free with code FB2017! In the coming weeks and months, we will be chatting to all the Indaba partners, asking them why they are joining the event and what their most important message for finance professionals is. Do you want to hear how Alternative Circle can help with your KYC processes? Do you want to be informed about the latest and greatest in finance? Then don't miss the Finance Indaba Africa 2017. The Finance Indaba is the biggest annual event on the continent for financial managers and specialists who are seeking partnerships to drive progress. Thousands of delegates will gain valuable insights into realising financial performance and growth, becoming more efficient and accessing funding, among a host of other opportunities from leading players in financial services.

Why will you be present at the Finance Indaba?
"Anthony Kariuki and I founded Alternative Circle in 2016 with a dream of revolutionising financial technology industry globally. We closed a seed round of $1,1 million from CreditInfo in March this year and this enabled the expansion of the company. The company now comprises of a young energetic team, with a passion to succeed as a team.

"Our presence at the Finance Indaba will satisfy our curiosity in several capacities. For starters, we want to find out what the FinTech ecosystem looks like the continent. We would also like to mingle and network with like-minded entrepreneurs and different major players in the different markets to assess the interoperability of our product across the continent.

"The Finance Indaba 2017 will also present an opportunity pitch and possibly raise more capital to finance our next scaling move which is to launch in another African market and South-East Asia.

"Finally, we are looking to showcase our product - the Shika mobile application - and take this year's participants through how the app works as well as get the word out about it in the continent."

What will you be talking about or showcasing?
"We will showcase Alternative Circle's first product, Shika App, a micro-lending mobile application created to solve the problem of individuals unable to access loans since they lack a credit history. The app is able to perform a background check on the individual's mobile money and bank transactions in less than 180 seconds to find out if one is eligible for a loan, through a Business Evaluation Engine (B.E.E), which we created ourselves. Once approved, the loan is processed within 30 seconds and sent to the individual's phone therefore making credit facilities available to these individuals.

"The application was also built with financial institutions in mind. These institutions need new channels to disburse micro-loans since they have no human capital or the infrastructure to give out micro loans. Alternative Circle has partnered with banks, filling in that gap by letting its customers without a credit history access loans in a fast and easy way. These financial institutions fund our lending pool, and they get a return on their investment. So far, we have raised $15 million in Kenya for our lending pool.

"We will also showcase the wider Alternative Circle vision to become a global company and to own the user. We believe that the user is the true source of value in any business, and if you service them well you can grow them and they in turn will grow your business."

What challenges can you help finance professionals/firms with in 2017?
"One of the major challenges financial institutions have is obtaining customer data or KYC (know your customer data). Most financial professionals/firms use traditional means to obtain this data. That is, collateral such as land, vehicles or other tangible assets. They also use data on income to judge the credit worthiness of their clients. In a continent where fewer and fewer people have tangible assets or regular cash flow, technology is the only route to financial inclusion. As mentioned earlier, we have built a credit rating algorithm that we call B.E.E, which sifts through users' mobile meta data to find their credit worthiness. We look at over 2 000 data points. We have found that this has revolutionised data in Kenya and are looking to use this to achieve our different business goals.

"Secondly, we give financial professionals/firms an avenue to deploy capital quickly, safely and efficiently to customers. We have a plug-and-play solution. Financial Institutions plug in with their capital and we deliver to them significant returns on their capital. Our product is complex, difficult to build, requires an enormous investment, a large development team and a user experience team. We have saved financial institutions from having to build this infrastructure themselves. The strategic partnership with CreditInfo gave Alternative Circle access to over 200 developers and 25 data scientists, making it easier for Alternative Circle to manage this platform.

What is the biggest challenge facing African FinTech businesses?
"Capital - Finding capital in Africa is a difficult task. FinTech is largely a new form of business, thus many financial institutions are not yet fully willing to commit capital to it. It has been a hard grind raising money and ironically, most of the money flowing to FinTech start-ups is coming from outside of Africa."

"Developers - It is becoming harder and harder to find world-class developers within Africa. Our partnership with CreditInfo has helped a huge deal, since we have access to over 200 of its developers, that help us in different aspects in making the app better.

"User Experience (UX) - This is a major part of FinTech that is often ignored. The user (customer) is the core of any company. User Experience focuses on understanding the wants and needs of the user. A key element in this is UX Research that plays a big role in development of any app. UX researchers are also a rare find in Africa, making this also another major challenge."

What do you see in the future of FinTech on the continent?

"The future of FinTech in Africa is to facilitate a completely cashless system. FinTech will eventually integrate to be the core business of financial institutions. Banks will become branchless, physical cash will become scarce, and financial inclusion will spread significantly to even the remotest areas of the continent."

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