Kenya-based financial technology (FinTech) firm Pezesha has won first place at the 2020 AFI Inclusive FinTech Showcase, after impressing AFI members and our panel of expert judges with an online pitch on how their solution is leading innovation in financial inclusion.
Pezesha, translated as “financial empowerment” from Kenyan Swahili, provides a digital platform where micro, small and medium-sized enterprises (MSMEs) can tap into finance after being matched with investors – including banks, microfinance institutions and other retail lenders – seeking to foster productivity and growth among small businesses.
Hilda Moraa, Pezesha’s founder and chief executive officer, connected via live feed to spotlight her company’s work in helping MSMEs across sub-Saharan Africa reach vital capital needed to grow their businesses.
“We are tackling the USD328 billion financing gap for MSMEs across sub-Saharan Africa … and the more than 50 million businesses that have been excluded and underserved,” she said.
Focusing on underserved markets in Sub-Saharan Africa, Pezesha, the competition’s second winner uses alternative transactional data from suppliers and partners to produce credit scores that give them access to credit for purchasing additional inventory. This is financed by investors using algorithms that aim to diversify risk by enabling lending to more secure small businesses.
Last year’s inaugural showcase event was won by OKO, which provides agricultural insurance to smallholder farmers in Mali.
“Everyone benefits in our value chain ecosystem: lenders can optimize their capital; suppliers can increase their network of merchants, and merchants can grow their inventory,” Moraa told the panel.
MSMEs can also use the platform, she explained, to learn about ways to increase their credit score by transacting through digital platforms and creating a digital presence. Its tools, she added, improve the knowledge and skills of customers by educating them on how to increase cash flows and safely expand their business.
Since its launch in 2017, Moraa said that the Pezesha has funded more than 75,000 loans to MSMEs, educated more than 200,000 MSMEs and disbursed more than US$2 million across Kenya.
Second place in this year’s competition went to Idemia, a France-based multinational technology company, which uses digital identification to aid in the enrolment and disbursal of funds, including government subsidies to low-income and vulnerable population while Arifu, a Kenya-based social enterprise, came in third with its smart personal learning assistant and content marketplace that offers advice and financial skills training to vulnerable groups, including farmers, youth, women and MSMEs, through mobile phones.
The top three finalists will be invited to participate in select activities of AFI’s Public-Private Dialogue platform and be awarded a one-year membership to Luxembourg House of Financial Technology (LHoFT), which provides practical training, education and research services for the FinTech community.