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The funding round was led by 4Di Capital, Octerra Capital, VestedWorld, Voltron Capital, Logos Ventures, and several other angel investors, to expand into other countries in Africa and other emerging markets. The startup which started in August of 2020, had also ventured into Kenya to begin full operations last July. Still, on its expansion mandate, the FinTech has commenced a recruitment campaign for expansion into 16 markets which include Ghana, India, Uganda, Brazil, Colombia, Mexico, Russia, Poland, Pakistan and Indonesia. According to the FinTech’s co-founder and CEO, BFree strives to develop better, ethical and tech-inspired debt-collection tools and processes following the first-hand experience of the founders – Chukwudi Enyi (COO), Moses Nor (CPO), and Flosbach, working for digital lenders in Nigeria. Clarifying how the company had arrived to channel the focus around the use of ethical debt collection standards, working closely with defaulters for custom-made payment options to increase repayment rate and customer satisfaction, he said:
“We saw that there was like a little bit of a breach in the value proposition of lenders — they are good at giving out loans, but the aftersales services of the credit market didn’t work as collections processes were inefficient and not user friendly.”
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In ensuring BFree attains its goal, it is securing the services of leading industry professionals, such as CTO Konrad Pawlus, previously of SALESmanago, and Yohan Theatre, who had formerly worked at investment management firm PIMCO. Both industry leaders are expected to work to enhance the startup’s new business working to disrupt traditional finance, by leveraging blockchain technology for secondary debt markets. According to Theatre:
“Lenders in the US or Europe have the opportunity to sell significant chunks of their debt portfolios to third parties. This means they only carry a portion of the risk of the loans they issue. In emerging markets, this is typically not the case. Lenders have to carry the entire credit risk on their own. A key driver for this difference lies in higher transaction costs and contractual uncertainties.” “The arrival of DeFi (decentralized finance) is a game-changer: transaction costs can be slashed while contractual certainty is increased by smart contracts. These are some of the risk-sharing instruments that we are now actively providing to lenders and borrowers…”
What We Should Expect
The platform asserts it has so far followed up with 1.1 million defaulters to date, and are presently managing around 800,000 customers, with most of them in Nigeria. This has further anticipated that Bfree will hit 1.4 million by the end of February 2022. The FinTech further claimed that it is presently working with 30 credit institutions, consisting of digital lenders, micro-finance and commercial banks to create the user profiles of defaulters, and run their data through an algorithm, to forecast their behaviour and propose the best collection strategy, using data provided by the lenders. Featured Image Source: NairametricsGot a suggestion? Contact us: editor@connectnigeria.com
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