, a digital platform that leverages social trust and group responsibility to deliver financial services in Africa, has launched a new range of business loans that enables market traders, spare part dealers, textile traders and other small business owners in Africa to take advantage of the power of their communities to access the working capital they need to run and scale their businesses.
Across Africa and other emerging markets, community groups and associations play an important role in providing various essential services and protecting the interests of the collective. They also facilitate accountability and self-governance that enables communities to function as effectively as possible.
According to the African Development Bank , SMEs account for more than 90 percent of businesses and almost 80 percent of employment in Africa. However, insufficient data and ineffective credit decisioning by traditional financial institutions have led to a $421 billion credit gap, with business owners unable to access the working capital they need to scale.
Moni has built a risk engine that combines financial data and business performance with social intelligence to enable more effective credit decisioning for African SMEs. Starting with Nigeria, small business owners with a good social reputation simply need to join a lending cluster with an invite from an existing Moni user and once eligibility has been confirmed, they can access financing in 5 minutes or less.
The Y Combinator-backed startup launched the pilot of its community-powered loans in August 2021 with 3,000 mobile money agents . In 2022 alone, Moni disbursed more than $22 million in loans to more than 11,000 SMEs, with a 99 percent repayment rate. The company is now building on the success of its community-powered model to deliver game changing financial services to a wider range of African SMEs who have previously been underserved by the traditional financial system.