The company aims to drive financial inclusion by credit scoring more people, especially those who are currently unbanked and are new to credit. CredoLab has announced that it is in negotiations with large financial institutions, digital banks, credit bureaus, consumer lenders and retail operations in Kenya.
The firm had in July this year announced its plans to expand its operations to Sub-Saharan Africa’s fintech market with the addition of three new clients – two banks and a leading airtime credit provider.
In what is set to revolutionise credit scoring and increase financial inclusion in Kenya, a new company is targeting your smartphone to make this possible.
“With the trend in Kenya of banks shifting from traditional banking halls to digital platforms, our alternative credit scoring technology is perfectly timed to help lenders provide access to sections of the population that have been traditionally financially excluded” CredoLab’s head of sales for Europe and Africa Michel Massain said.
CredoLab collects more than 50 000 data points from a customer’s smartphone through its mobile technology and turns them into more than 500 thousand behavioral features.
According to the firm, the collected data is anonymised, securely stored within the country, and never shared with third parties. All digital scorecards are customised for clients, whose requirements, risk appetite and credit scoring thresholds are unique.
CredoLab says that by making granular credit assessments possible, their clients have seen results like 20% higher new to bank customer approvals, a 15% reduction in non-performing loans, and a 22% dip in fraud rate.
This use of non-traditional data and predictive analytics for credit scoring enables lenders to expand their pool of borrowers while keeping risks under control.
CredoLab was launched in 2016 in Singapore to address the lack of instruments to assess the credit worthiness of nearly two billion consumers globally.
Its arrival in the market is set to spark further competition in the credit rating sector which is currently controlled by Metropal, Creditinfo and Transunion Africa.