SeedFi, a digital-first lending company, has set its sights on expanding access to credit to fuel Nigeria’s economic growth. In a nation where a significant portion of the population lacks the typical collateral and credit history required by traditional lenders, SeedFi aims to bridge the financing gap by reaching out to peri-urban populations, small business owners, artisans, and other groups typically left out by traditional lending institutions.
Pelumi Alli, the Founder and CEO of SeedFi, said this commitment arises from a critical observation: a staggering 67 percent of Nigerians refrain from seeking credit, even from family and friends. The reasons behind this reluctance include the unavailability of data for decision-making, limited access to formal financial services for specific demographics, a lack of financial education, and a general distrust in the financial system.
To address these challenges, SeedFi has embarked on a mission that not only expands credit access but also offers financial education and fosters trust among consumers. They do this by sharing valuable information on building a solid credit profile and effectively managing personal finances, all while providing flexible repayment structures.
Alli emphasizes SeedFi’s unique approach, saying, “By leveraging data from various sources, we’ve developed innovative credit scoring models that assess creditworthiness and offer loans to individuals and businesses with limited or no formal credit history.”
SeedFi’s innovative data-driven strategies are instrumental in reducing the risks associated with lending. SeedFi envisions a world where the aspirations of young Africans are supported through access to credit and financing.
They strive to improve the credit experience for borrowers while managing risk for lenders by leveraging insights from diverse data sources. Their goal is to bridge the financing gap with flexible, convenient, and affordable digital lending solutions tailored to meet the diverse needs of customers.
What sets SeedFi apart from others in the lending market, according to Alli, is its commitment to customer-centric practices. They take pride in the reducing principal balance interest calculations, ensuring that each customer pays less in interest charges with every repayment. Additionally, they offer the convenience of rescheduling loan repayment dates to suit the borrower’s needs.
Samaila Dogara, the Co-Founder explained that one of SeedFi’s standout features is their “cluster” lending option, which allows customers to obtain loans as a group, fostering accountability among members to maintain good credit scores.
Transparency and integrity, Dogara enthused, are core values at SeedFi, which is why SeedFi does not impose hidden fees, and all costs are clearly communicated to customers before any charges are applied. Loan terms and conditions are presented in a clear and easily understandable manner, with customer consent being a priority.
As the financial landscape evolves, SeedFi remains poised to embrace the future. Research shows that as financial education improves, middle to low-income earners are more willing to use credit rather than deplete their savings for significant purchases. This shift, fueled by the growth of the digital economy, has created opportunities in sectors such as Buy-Now-Pay-Later (BNPL) and increased demand for credit cards, all of which SeedFi is actively exploring.
Alli stated that SeedFi’s mission to expand credit access is not just about providing loans; it’s about fostering economic growth, empowering individuals and businesses, and creating a brighter financial future for all Nigerians.
With their innovative approach and unwavering commitment to transparency and integrity, SeedFi is poised to make a significant impact on the financial landscape of Nigeria and beyond.
