The Future of Debt: Can Fintech Fill the Gap?

How can small businesses gain access to the working capital they need? Zach Bijesse of Payhippo and Tunde Kehinde of Lidya are trying to figure it out. Hear how new technologies are changing the future of lending for small businesses in Nigeria, Africa, and the world.

With over 200 million people and 40 million small businesses, Nigeria is the perfect spot to launch a fintech company that’s trying to push the boundaries of how businesses get capital. Both Zach Bijesse and Tunde Kehinde saw a huge market opportunity in Nigeria with its sheer size and strong startup culture. Their companies, Payhippo and Lidya, respectively, are using artificial intelligence and machine learning to make lending faster and more accessible for entrepreneurs, and in turn, more successful for this new breed of lender.

Zach makes the problem clear: “Businesses can’t get money in Nigeria when they need it. It’s that simple.” 

Tunde believes that artificial — and human — intelligence are key to filling the small business lending gap. “Humans are involved in setting the rules. I think on average per loan, we have close to a thousand data points we look at. And so humans are looking to say, based on our assessment criteria, is it working or not working? And if it's not working, how do we tweak the rules to make sure the recollection is done properly?” 

Likewise Zach’s Payhippo endorses ongoing experimentation and the importance of training their algorithms to get better over time. “People forget that you can only train your machine learning algorithm based on your data set. So, you know, we have a few defaults in our loan portfolio. That's not a bad thing. You just have to give loans and figure out what works.”

Unlike most entrepreneurs, these two aren’t intimidated by competition, even from banks themselves. Instead, they’re always looking for opportunities to collaborate and partner. As Zach explains, “there's a $46 billion opportunity for small business lending in Nigeria. Why would Payhippo need to take one hundred percent of the market? Let's keep growing and do what we do. And then once we get a little bit of bandwidth, it'd be great to empower the other guys and collaborate with them. That's really exciting to us because then the whole financial infrastructure develops and it's better for everyone.”

Listen to Zach and Tunde’s story to learn how technology and new ways of thinking can impact how you approach and solve your specific business and market challenges.

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