At the heart of Africa’s growing economies, you’ll find millions of small businesses. They create 80 percent of the continent’s employment and provide goods and services that fuel GDP growth — but almost half are excluded from accessing financial services. This familiar story of financial exclusion continues to prevent these businesses from reaching their full potential.
Take, for example, Becky Norkeye, an Accra salon-owner with 28 years of experience styling hair. Becky now runs a successful salon that provides employment to several women, but she wants to further grow her business. Becky is trying to equip underprivileged women with the skills to succeed, and has founded a programme to train them in hair-styling so that they can gain meaningful employment. Becky wanted to expand her salon, hire more and invest in other services and products. She tried looking for some working capital but didn’t know where to start.
Becky is one of millions of Ghanaians who don’t know how or simply cannot access the financial products required to grow their enterprise. Even when they overcome significant obstacles to apply for loans — such as travelling miles to visit a bank branch, waiting in long lines or gathering complex documentation — many applicants are denied. They go from bank to bank in search of a loan approval, resulting in wasted effort both for themselves and for the banks who invest time and money to find customers and review their applications.
In order to address these systemic challenges, digital-finance expert Carol Caruso and technologist David Hutchful have founded a new fintech called Bloom Impact, which is a digital marketplace that connects African entrepreneurs to financial products via a mobile app — and educates them along the way. We like Bloom Impact, because the app drives financial literacy by guiding entrepreneurs so they understand what they need to do to become eligible for loans, savings and current account products. After asking some straightforward questions, its artificial intelligence algorithm scores and matches applicants with products that meet their specific business needs. Further, by enabling users to upload photos of themselves and their documents, the app also simplifies and secures the process of identity verification for banks.
After reading about the app on social media, Becky downloaded it from the Google PlayStore and began learning about financial products for which she was eligible. When speaking with her about her experience she said, “Using my phone was great, I could learn about what I needed in order to apply for a loan and process the application on my time, wherever I wanted.” Using Bloom Impact, entrepreneurs like Becky can gain financial education and access loans straight from their phones.
By connecting entrepreneurs like Becky to financial institutions previously out of reach, Bloom Impact is not only promoting business growth but hopes to fuel job creation. Given that over 50 percent of global population growth between now and 2030 will happen in Africa, creating employment is critical to achieving economic growth in the region. Having launched in Ghana in late 2017, Bloom Impact is attracting attention from small business owners and has already partnered with various financial service providers, such as Advans, Fidelity, CCML, GHL and others. This fintech startup is one to watch,
Using my phone was great, I could learn about what I needed in order to apply for a loan and process the application on my time, wherever I wanted.