Page 217 - The Digital Financial Services (DFS) Ecosystem

ITU-T Focus Group Digital Financial Services
Ecosystem

Table 6 – Examples of authentication

Company Authentication

Branch National ID
Social media
Commercial Bank of Africa and Digital wallet PIN
Safaricom
Greenshoe Capital National ID

KCB M-Pesa and Safaricom Digital wallet PIN

Lenddo National ID
Traditional banks National ID

Nearly all of the programs reviewed do not require collateral, though some allow the customer to save, which
is taken into account when determining the loan amount.

Table 7 – Examples of collateral requirements

Company Collateral
Commercial Bank of Africa and Savings (optional)
Safaricom

KCB M-Pesa and Safaricom Savings (optional)

L-Pesa None
Traditional banks Typically required

The speed at which these programs are able to assess creditworthiness using alternative credit data is blinding.
While traditional banks and even microfinance institutions (MFIs) may take days or weeks to make a loan
determination, these programs are committing to loans in minutes or even seconds. Some programs are even
pre-determining loan eligibility and are waiting for customers to ask for a loan as long as it does not exceed
the pre-approved amount.

Table 8 – Examples of decisioning

Company Decision

Commercial Bank of Africa and Immediate
Safaricom

InVenture Seconds
KCB M-Pesa and Safaricom Immediate

Lenddo 3 minutes

Traditional lenders 1-6 weeks
In-person

Most programs are leveraging their connection with DFS accounts in order to quickly distribute funds. In many
cases, funds are available immediately. This contrasts with traditional banks, which can take weeks for funds
to be available.

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