In the last few years, the Digital lending business in Nigeria has grown.
Access to credit has long been a problem in the lending space. Before digital lenders came along, this credit problem was said to be the fault of retail banks. Why were retail banks so risk averse that they happily waved away the chance to make revenue from
interest payments?
Well, digital lenders are finding out first hand.
With no effective credit bureaus, the average Nigerian does not have a credit history. There are also no real institutional disincentives to prevent people from owing lenders.
The summary: Nigeria’s digital lending space could use some startups that could help with some structure. Those structures would benefit the
lenders and borrowers.
Last month, we talked about Evolve Credit providing a loan marketplace where people can compare rates from digital lenders.
Enter CARMA, a data startup helps lenders make better credit assessment decisions by giving them access to a “real time credit data on a peer to peer basis.”
While CARMA was launched in Nairobi this year, it has now received funding in a
round led by Nigerian VC, Microtraction.
Up next: CARMA has now launched in Nigeria and it will mean an extra tool in the digital lenders arsenal to make better lending decisions.
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