Why We Exist

//Why We Exist

This is a more detailed expansion of the ideas expressed in our About Us introduction.

 

The Challenge

Finplus was founded to address the fundamental problem of Financial Exclusion which is arguably one of the biggest challenges of our time. Over 2 billion adults around the world currently lack access to formal financial services according to the World Bank with approximately 73% of these adults living in just 25 countries, all emerging markets across Africa, South America and South Asia. Lacking access to basic savings & credit services has a detrimental impact on multiple aspects of life, from nutrition and quality of health, to literacy, education & income levels as well as overall social mobility. Without reliable financial support structures, these families have limited options for financial growth and are constantly at high risk of remaining in or potentially falling back into poverty if any shocks disrupt their delicate (and often times insufficient) income streams or should any emergency expenditures arise.

 

Our Vision

To create a world where everyone can instantly access basic financial services anytime, anywhere, regardless of location, language or economic circumstance.

 

Our Approach

It’s a big goal and fortunately, our approach to the problem means we have a lot of help. Over 36,000 Financial Services Providers (FSPs) globally, from Banks and Microfinance Institutions (MFIs) to Credit Unions (SACCOs) and Financial Services Associations (FSAs) are all independently working towards providing both for-profit and non-profit financial services to as many people as possible. However, they are facing several serious challenges, chief among them:

Low capital efficiency: Currently, the primary revenue source for FSPs is the interest they charge on loans, each of which typically requires over the course of its lifetime several man-hours to originate, appraise, score, disburse, monitor, collect, reconcile & close. To operate at scale, they need hundreds to thousands of trained employees to drive these core operational processes everyday, costing up to 65% of their growing annual operating budget.

Broken processes & solutions: Technology is the obvious solution to the first problem but when applied intermittently to operational processes that were originally designed for manual operations the results can be less than ideal. The average Digital Financial Services technology stack has components from multiple vendors and many still lack robust APIs, often requiring middleware from other vendors or more commonly, manual interventions that force human talent to waste time on avoidable emails, calls, exporting, tracking, importing CSV/XML/Excel files across multiple systems etc.

Underdeveloped ecosystems: While Banks lead in using USSD-based apps to deliver financial services via feature phones, most offline low-income users in developing countries are far more likely to access financial services through MFIs & SACCOs, many of which due to capital constraints or unfavorable economies of scale (or both) currently run sub-efficient often manual operations. This results in less innovative offerings and thus lower adoption among customers, which inadvertently limits access to Financial Services in these markets.

We believe that these particular challenges can be overcome through innovative approaches supported by the right technologies. So instead of re-building the wheel, Finplus combines the power of robust digital finance technologies with the existing infrastructure of Financial Services Providers globally to accelerate progress towards the goal of universal access to financial services, with a primary focus on the 25 countries that are home to 73% of the world’s unbanked adults.

 

Our Solution

As a first step towards solving this problem, Finplus provides automation software for easy management of digital finance operations at scale.

Our platform makes it easier and significantly more cost effective to provide or expand Digital Financial Services in any market by automating significant parts of a financial service provider’s front & back-office operations. We handle all the repetitive heavy lifting so Financial Services Providers can focus on their core business and serve as many people and businesses as possible, with universally accessible offerings & faster, more innovative service delivery methods.

The Finplus platform is cloud based meaning there are Zero Infrastructure Costs for our customers and we use a Subscription billing model which translates to a Low Up-front Cost for them. Our ultra-configurable USSD interface is particularly useful since it allows distribution of many different kinds of services through any phone to anywhere with a cell signal. This makes it significantly Easier, Faster and Cheaper for FSPs to expand their services coverage into new areas and thus drive our goal of increasing access for ever more people.

The Finplus Digital Financial Services technology layer works on 3 axes to help achieve our shared vision:

Universal Availability: By designing simple-to-use service interfaces for both feature phones & smartphones we push FSPs to mobile-first origination, making it possible for their financial services to easily reach the world’s most remote areas.

Faster Service Delivery: By digitizing many of the back-office processes FSPs require to deliver financial services and meet regulatory requirements, we accelerate the speed of service delivery while effectively controlling risk.

Lower Costs: By using automation to enhance operational efficiency and reduce resource waste, we lower the cost of providing financial services, which frees up more capital for expansion so that these vital services can reach ever more people.

 

Potential Impact

Finplus software will serve over 1,000,000 people and save Financial Services Providers in Kenya, Tanzania and Uganda (3 of the 25 key countries mentioned above) over 250,000 man-hours in 2018.

While our primary goal is to accelerate the rate at which unbanked adults gain access to financial services, many other indirect benefits ripple out from this. For instance, moving a Financial Services Provider’s origination, appraisal, approval, disbursement, collection and reconciliation processes from paper-based to electronic workflows, will over the years save countless trees in voided paperwork.

Furthermore, using basic mobile interfaces allows customers to access these vital services around the clock regardless of their location, meaning that financial shocks such as medical emergencies in off-business hours don’t necessarily create instant financial distress or worse still, longer term economic strain.

It also shaves hundreds of thousands of man-hours each year from the working days of the service provider’s employees so they can spend that time doing more valuable things. It often means they no longer need to commute to and from different offices or routinely ship documents back and forth, which drastically reduces their carbon footprint.

Additionally, moving these and many other vital processes to risk controlled platforms that improve visibility, enhance transparency and enforce accountability can not only reduce exploitation but also close loopholes that leave gaps for corruption and other vices commonly encountered in informal or paper-based economies.

Access to financial services should not be a privilege. It should be a human right. Available to everyone, everywhere, who wishes to participate in the modern economy. We are working to make this dream a reality.

 

How can you get involved?

Join our team. We’re hiring.

Spread the word. Share our message with the world.