Kehinde: That’s a fantastic question. Our mission is to unlock credit for Africans, and we believe access to fair and fast funding is critical for financial inclusion and economic growth in Africa.
We started as a digital lender and have disbursed over $100m in credit across over 32,500 loans to customers, with 1% default rates. As we continued to scale, we realised that no matter how aggressive we were in giving credit to customers, the demand for credit (Over $300bn credit gap in Nigeria alone) could not be satisfied by one lender.
BI Africa: Lidya has registered over 220,000 businesses, disbursed ~32,500 loans, and is approaching US $100m in disbursement value across Nigeria. Can you discuss how Lidya has achieved this level of growth and what challenges you have faced along the way?
Kehinde: The answer is simple, but the path was not always straightforward. I see three main factors that have contributed to our growth; the market, our technology, and our team. When we launched Lidya, we were perfectly aware of the need for SMEs in Nigeria to access simple, quick, and reliable funding, and that was exactly what we offered them, which translated into immediate high demand. To ensure sustainable growth with low non-performing loans, we focused deeply on deploying technology that gave customers instant working capital to continue growing their businesses without sacrificing credit quality. The third factor, and I dare say the most important, is that our team always had the capacity to adapt to new challenges with a customer-first approach.
In such a dynamic market, the ability to adapt to different demands and opportunities is always a big challenge. Thanks to our customers, technology, and team, we have been lucky to keep evolving and growing in the Nigerian fintech space.
BI Africa: Lidya has recently shifted its focus from a lender to a credit enabler, providing financial institutions with the technological infrastructure to originate, manage, and collect loans. Could you tell us more about this shift and how it will help unlock credit for Africans?
Kehinde: We view this as a natural evolution of our mission. We greatly believe we can go further and achieve our mission faster through partnership. Our infrastructure unlocks excellence in digital lending so banks, FinTechs and any microfinance institution in Nigeria can scale up their lending with lower risks. By using our credit infrastructure, all of these lenders will be able to deploy a wide variety of loans faster, with a higher repayment rate and, importantly, great after-sales service.
BI Africa: The Collect tool that Lidya uses to collect repayments has been highlighted as a key feature of your platform. Can you elaborate on how this tool works and how it has enabled Lidya to achieve a 99% repayment rate?
Kehinde: Lidya Collect solves the problem of Non-Performing Loans. It is clear to us that for digital credit to grow sustainably in Africa, there needs to be innovation to disburse credit and reliably collect digital credit so lenders can deploy more credit products and be confident they will get repaid.
Lidya Collect is powerful because it allows Lenders to integrate digital collections solutions into their customer experience that ensures automatic, instant settlement of credit payments from any bank account a customer wishes to utilise for payments while also allowing flexibility to take cash or card payments. In practice, this means that lenders no longer have to use manual, cumbersome collection methods such as checks or physical visits to banks to activate direct debits.
By providing this solution, lenders will have more confidence to sustainably scale their loan books with financing that can reach and impact more people.
BI Africa: Lidya has some blue-chip customers, including Accion, who you have partnered with for credit enabling. Can you talk more about this partnership and how it benefits both Lidya and Accion?
Kehinde: Yes, 10 institutions have signed on to use our credit infrastructure, and we expect this number to continue to grow significantly. We have partners like Accion who work with Lidya to digitally assess, disburse, and collect digital credit. Other partners use our digital collections tools to prevent NPLs, while some partners leverage our infrastructure to acquire new customers and grow their loan portfolios. We see so many use cases for our infrastructure, particularly the creation of new credit products, from credit cards to auto loans and more. Our thesis is that as lenders have confidence they can collect digital credit, it will give them the confidence to innovate and deploy more products that benefit customers.
BI Africa: Lidya’s system is fully digital and flexible enough to integrate or operate standalone, making it easy for lenders to go live today. How do you ensure your system is secure and data privacy is maintained?
Kehinde: Exactly, our goal is always to create solutions that are flexible enough to fit many use cases. So, we provide our Standalone platform that allows lenders to go live today and our API that will enable them to integrate Lidya with their existing technology.
As you know, Lidya has been in the market for more than six (6) years; we have assessed more than 200,000 businesses, so security and data privacy are always on top of our minds. Our data is secured in the world’s largest and most secure data centres, with redundancies in different geographies. Our data and our customer’s data are protected like all tech giants protect their data.
BI Africa: What are the other benefits of using Lidya’s technology infrastructure for microfinance institutions, banks, and FinTechs?
Kehinde: The main advantage is sustainable growth. Lidya enables excellence in digital lending. We help these institutions go digital today, helping them deploy the best loan products for their customers with the peace of mind that they will have a reliable credit infrastructure that assesses accurately and collects their loans on time, every time.
Partnering with so many great institutions to unlock more credit across the continent is a privilege. With Lidya’s secure, flexible credit infrastructure, lenders can confidently acquire customers, originate loans, collect repayments, and manage their portfolios at scale. In summary, together, we can do more faster.
BI Africa: You have been called ‘The Jeff Bezos of Africa’ by the BBC and C2 Montreal. How does it feel to be recognised as a leading entrepreneur in the industry, and what advice would you give to aspiring business leaders in emerging markets?
Kehinde: I realise that while I am the chief spokesperson for Lidya, I am part of a team of talented colleagues, supportive investors and innovative partners working together to deliver one mission – unlocking credit in Africa. So anytime I am given any recognition, it’s important to me to ensure all “Lidyans” share that recognition as we all do this together and will go farther together.
The main advice I would give is to build a talented and competent team that also believes in the mission and will persevere when times are tough because of that belief. Lastly, have fun! We all have one life, and enjoying the journey we have all been blessed to embark on is important.
BI Africa: Finally, with the increasing popularity of digital lending platforms, how do you see the lending landscape evolving in the next few years? How is Lidya positioning itself to stay ahead of the curve?
Kehinde: We are laser-focused on deeply understanding our customers’ problems. The closer we stay to our customers, the more empathy and openness we have to solve their problems, and the farther ahead we will stay off the curve. Everything starts with helping our customers achieve their visions, and as long as we do that, we will continue to succeed.