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Sifelani Tsiko, Innovations Editor
Taking a personal loan from a bank for a civil servant or pensioner can be a challenging and hectic process.
A lot of information is needed —whether these are unsecured or secured loans, details of collateral requirements, interest rates, payment terms and which financial institutions have competitive rates.
Many civil servants and pensioners have no idea how the financial system works and this has led to several mistakes and bad financial decisions, such as taking out loans with high interests.
A desire to minimise risk and assist would-be borrowers sparked an idea for two fourth year University of Zimbabwe Computer Engineering, Informatics and Communication students to create an app to help civil servants and pensioners to access loans easily.
The two — Tatenda Nyakudziguma (22) and Kudakwashe Muzari (23) have now formed a start-up company called CredSpace to bridge the financial gap for civil servants, pensioners and SMEs through innovative credit solutions.
“At present most financial institutions use traditional mobile and web applications, which only cater for around 9 percent of the population, leaving out a huge gap without easy access to loans,” Tatenda said.
“We have developed a WhatsApp Chatbot that can be used for loan applications, to check loan status, to check interest rates as well as the monthly repayment terms. More than 34 percent of the Zimbabwean population uses WhatsApp to communicate. Even pensioners can use it.
“Through the WhatsApp Chatbot, we have enhanced efficiency in loan applications by reducing paperwork and other bottlenecks. Someone can apply for a loan in less than 5 minutes.”
He said a person or client can just send ‘hi’ on our Whatsapp number: +263712771836 <https://wa.me/message/D7UA54ZW3ABGK1> and select option one for loan application and complete other categories to access loans.
“This saves civil servants and pensioners time and money for travel. It’s fast, cuts on paperwork and other printing costs. It’s efficient and a client can easily follow up on the status of the loan application.”
A WhatsApp Chatbot provides leads and or customers with a real-time automated conversational experience directly on the messaging app. In this case, the WhatsApp application uses mobile data to help clients access their loans.
“My partner — Kudakwashe — came up with this idea after he went for attachment at a local financial institution. Whilst working there, the volume of paperwork was scary and cumbersome. And so he thought that we could develop something that could reduce paperwork and speed up the loan application process at a lower cost for clients,” Tatenda said.
“To bridge this gap, in February this year we created a start-up company called CredSpace. We launched it in February and within two months we have managed to help civil servants and pensioners access loans worth more than US$50 000.
“Notably, the company achieved the shortest application to disbursement time of 15 hours, a testament to its efficiency. CredSpace now boasts an impressive client base of over 270 000 individuals and businesses, demonstrating its vast reach and potential for growth.”
Tatenda said their company makes money through a commission earned from financial institutions allocating the loans.
CredSpace gets a 5 percent commission for every successful loan application.
Tatenda and Kudakwashe are now working to patent their innovation and have created employment for five people.
By leveraging WhatsApp, a platform familiar to 38 percent of the population, the young innovators have made loan applications convenient and accessible, unlike traditional mobile and web applications that only cater to 9 percent of the population.
This innovative approach has enabled the start-up company to reach a wider audience, promoting financial inclusion.
But they still face some problems to win the hearts and minds of civil servants and pensioners.
“As we are growing, we face some challenges too. The major hurdle is trust. Many people still think that we are a scam, but we are slowly building trust and getting more people to access loans,” Tatenda said.
Looking ahead, he said CredSpace aims to scale up its operations and expand its partnerships with microfinance institutions through harnessing new technologies to provide instant credit approvals.
“We are dreaming big and we want to be the leading financial technology company across Africa providing innovative credit solutions. As soon as we finish with Zimbabwe we want to expand to other African countries,” the young innovator said.
At present, the start-up is also developing tailored solutions for the private sector and SMEs, that meet their unique financial needs.
Tatenda said they will soon launch a CredSpace WhatsApp Chatbot platform to help SMEs access finance to grow their businesses.
The University of Zimbabwe now has a vibrant Innovation Hub, which is at the forefront of cutting edge discovery and knowledge production, ever since the country started the implementation of heritage-based Education 5.0 for the modernisation and industrialisation of the country, thanks to the Second Republic under the leadership of President Mnangagwa.
Education 5.0 is based on five major components that include teaching, research, community service, innovation and industrialisation.
“We are very grateful that the Government and the UZ have promoted the Education 5.0 philosophy to promote innovation and research among us young people. It has opened my eyes to new possibilities,” Tatenda said.
“We are so happy that as young and talented minds we are now harnessing scientific approaches and technology to help the country’s civil servants and pensioners to access financial products.”
A beneficiary of the CredSpace WhatsApp Chatbot is giving them wings to fly high.
“Hi, I’m happy to inform you that I have received the money as per your word. I highly appreciate your effort complemented with professionalism in service provision and may God bless you,” she said.
“We thought it’s a scam. Ndafara. So easy ufunge.”
Online Reporter