I am the CEO of a fintech startup that is providing financial inclusion to low-income via our app that can outreach users easily, evaluate the risk (with a behavioral credit analysis), KYC, and speed the loan process to who needs it the most at a fraction of the cost that a MFI would incur. Most of our users are informal entrepreneurs. Their work is directly affected by Corona virus as lockdown blocks them from being out, offering their services. Working from home is not an option. Besides it, they don't have the technological know-how or hardware to put their work online.
The financial institution that we serve is afraid that default rates are going to increase - they are not wrong. However, I think this more than never is the time that the low income will need support and trust from financial services. If the rich suffers from a financial crisis, imagine the poor. The difference I see is that the poor has already faced many challenges in life, and there will always be a way out - they just need a hand.
Defaults will increase, that is a fact, but I am thinking of ways to control it. More time to start payment? no fees or interest on delayed payment? I agree with Helmut's comment up here, that would be nice to have some sharing info from older organizations that have been through financial crisis.
I am the CEO of a fintech startup that is providing financial inclusion to low-income via our app that can outreach users easily, evaluate the risk (with a behavioral credit analysis), KYC, and speed the loan process to who needs it the most at a fraction of the cost that a MFI would incur. Most of our users are informal entrepreneurs. Their work is directly affected by Corona virus as lockdown blocks them from being out, offering their services. Working from home is not an option. Besides it, they don't have the technological know-how or hardware to put their work online.
The financial institution that we serve is afraid that default rates are going to increase - they are not wrong. However, I think this more than never is the time that the low income will need support and trust from financial services. If the rich suffers from a financial crisis, imagine the poor. The difference I see is that the poor has already faced many challenges in life, and there will always be a way out - they just need a hand.
Defaults will increase, that is a fact, but I am thinking of ways to control it. More time to start payment? no fees or interest on delayed payment? I agree with Helmut's comment up here, that would be nice to have some sharing info from older organizations that have been through financial crisis.