FinTech Frontiers: FRIENDS Consult’s Work on Inclusive Lending
Some challenge
Money is becoming virtual and digital faster than the smartest brains once guessed. Fintechs swiftly sprout out of designs and experiments of brilliant young minds and seasoned not-so-young companies. These Fintechs join existing ones in providing platforms for lending, or themselves lending directly. While regulators pace up to bring Fintechs into the fold, traditional internal policies and procedures developed for lending can seldom suffice for Fintechs lending or borrowing. The wholesalers to Fintechs are particularly affected. Typically responsible funders with a good track record of wholesale lending to non-Fintechs, their policies and procedures manuals are seldom tech focused enough to guide lending to Fintechs.
Our solutions
At FRIENDS Consult, we team up our top-notch Fintech associates and experienced banking/ credit experts to develop policies and procedures which are both Fintech facing and credit-prudence focused. This way, we design policies and process manuals to aid lending to and by Fintechs. The guidelines ease the credit underwriting and contracting processes involving hi-tech.
Recent case
Contracted by aBi Finance Ltd, FCL recently completed the development of policies, process manuals, and tools for operating Lines of Credit to Fintech lenders that finance agribusiness. Following a successful feasibility study conducted with the Financial Technologies Service Providers Association (FITSPA), aBi Finance engaged FCL to develop the following for lines of credit or wholesale lending to Fintechs:
- Master Policy, for use or adaptation by lenders (public good)
- Master Operations Manual (public good)
- aBi tailored Fintech Lending Policy
- aBi tailored Fintech Lending Operations Manual
- Fintech Lending Tools (for due diligence, credit underwriting, portfolio management and reporting)
- Training Manual for lending to Fintechs.
The above deliverables, developed after wide and deep consultations with relevant sector and market stakeholders, should help aBi and other wholesale lenders to Fintech in building up their Fintech loan portfolios soundly. Each of the deliverables embeds ESG principles, a keen technology focus, and sound-practice lending principles.
This landmark assignment once again demonstrates FCL’s commitment to participating in sustainable financial innovation for deepening financial inclusion in Uganda and elsewhere. FCL looks forward to delivering world-class, future-ready policies and manuals that will set new benchmarks for responsible Fintech lending in the region and beyond.
Dr. Keren Obara
Projects Officer (Marketing & Innovations)