FIDO Money Lending Limited, an innovative financial technology company that provided digital mobile credit to micro enterprises engaged in commerce has hosted a two-day training workshop for market women in Kaneshie. Beneficiaries of the training were taught basic financial literacy concepts including savings, lending, operating bank accounts and the usage of mobile money and digital financial platforms accessible from their mobile phones.
The strongly patronized event was part of the company’s ongoing corporate social investment effor5t aimed at promoting financial inclusion through financial and digital literacy.
FIDO also used the opportunity to introduce market women who attended the workshop to its own innovative digital credit offering through which its micro entrepreneur customers can access credit by applying directly from their mobile phones. No guarantor or collateral is required and feedback is nearly instant.
Interestingly, the company’s executives claim that its non-performing loans ratio is lower than the average for the universal banking industry which deals with bigger customers and usually insists on collateral. FIDO’s strategy is to encourage repayments by offering bigger, and cheaper loans as the customer establishes a track record of repayments as and when due. Thus, while first time loan applicants are charged 14% a month, this interest rate gradually falls to 8% a month as they continue borrowing and repaying as and when due. Loans range from GHc50 to GHc600, the limit rising as earlier loans are repaid. The loans are disbursed instantly to the customer’s mobile wallets.
Explaining the rationale for the workshop, Fred Frimpong, Deputy General Manager of FIDO Ghana said: “The need for all citizens to be educated in financial matters is critical to improve financial decision making. FIDO has already supported the under-banked segment with close to US$20 million in credit and we are committed to continue our mission towards financial inclusion in Ghana.”
The company has so far been using equity financing from shareholders to fund its micro-lending but recently has started accepting investments from the public, offering above market, but sustainable interest yields.
