It’s the year 2017 and a lot has changed and is changing fast in banking and microfinance industry. What saddens me as I write this article is level of blindness and ignorance in the industry? The very players cannot seem to stomach the new developments that calls for a paradigm shift – they are not ready for the changes and seem like they will never be ready –therefore a revolution has just started.
Denial – established want status quo
I will start with a friend who runs a group of microfinance companies issuing loans against collateral – logbook most precisely. In more than 5 times have tried to persuade him that the future is mobile and that he should transit to mobile – issue smaller loans but to a bigger number of people even within established institutions.
But he is a former banker and believes the old trade that has been around for 300 years can only get better. My explanation; that finance decentralization and mobile disruption of banking doesn’t make sense for his microfinance industry mastery and experience. – Over 30 years to be precise.
Have promised him to keep him updated with figures as Jisort marketplace gain traction – we believe Jisort marketplace will be processing more than 10000 applications for credit a day more than any brick and mortar bank branch out there. We also believe people will prefer non corporate finance institutions as time passes that this is the real focus of Jisort.
Jisort the platform
We seek to have a platform running of secure and reliable cloud; employing artificial intelligence to serve the needs of consumers better than any customer care department can do in a bank or microfinance institution.
Jisort becomes part of a customer life; it knows everything not just what was filled in the customer application form. Jisort knows birthdays, weddings, dates, new borns, bereavement, and other losses – Jisort can therefore be supportive to a customer better than any bank. – sounds hypothetical but time will prove it right.
If trust is the most important asset, why should it not replace material collateral that only a few possess – Jisort seek to make it easier.
How many people have idle funds that they would love to engage just for some returns – of course better returns than what banks offer – many , Jisort; a piece of technology which allow this to happen and coincidentally cheap credit facilities for more people.
Mobile driven Technology
Mobile money has transformed fund transfer especially in Kenya, emergency of Branch, Tala and Jisort should be a warning clear enough to the existing players of the impending changes.
CBA, KCB and Equity claim to have issued more money reluctantly over their Mshwari, KCB-MPESA and EAZZY LOAN mobile products than the traditional credit platforms – due to the capped interest rates story – capped interest rates are here to stay – and by the way, even if the policy changed, competition in the sector will force them to remain under 14 percent anyway. What they don’t realize is the mobile is the future.
Role of the Regulatory
Missing puzzle – corporate finance –The government needs to realize the changes and move fast otherwise corporate will lack finances. Ryanada today cannot secure funds from a bank, why – banks are giving mobile loans (as they wait for the interest capping to be removed- funny) which are applicable by individual customers only.
The government needs to explore and facilitate crowd funding for businesses from individuals and other players. The government should also facilitate bond financing and equity trading for SMEs for the much needed enterprise funding. I laud South African government for coming up with a state sponsored venture capitalist firm to address some of these issues – Kenya should follow suit. – and why are we the ones to follow, we were the trend setters??
At Jisort we innovate day and night to provide the ideal platform for the future financial institutions, mobile based non corporate ‘banks’ – sponsored through crowd funding probably. Let’s allow the brick and mortar banks to operate deposit boxes and other things.
I beg to put a comma for now…,