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Ayo Alonge [email protected]
The need to assist banks to grant credit facilities to small businesses necessitated the establishment of CreditRegistry Corporation, a software technology company headquartered in Washington State, USA according to the Co-founder, Jameelah Sharrieff-Ayedun.
The serial entrepreneur with multifaceted experience in business, technical and people management, with business experience spanning over 20 years Ayedun said that supporting SMEs would open more opportunities for the economy.
As the pioneer credit bureau in Nigeria and having grown the company to 858 per cent level of profitability, she told Daily Sun that the use of software, data and analytics can support effective SME lending services. She also spoke on other fundamental issues pertinent to credit and financing for SMEs.
Background
CreditRegistry established Nigeria’s first private credit bureau on January 3, 2003. The company was officially licensed by the Central Bank of Nigeria as CR Services (Credit Bureau) Plc. In strategic technical partnership with CreditRegistry Corporation USA (“CRUSA”), our company has laid the foundation for fraud-proof, large – scale consumer and small business credit in Nigeria.
Trusted with Nigeria’s largest credit information database, our members include 100% of the commercial banks, mortgage banks, microfinance banks, merchant banks, finance companies, development finance institutions, telecom operators, courier companies and other service providers. With experienced credit bureau specialists focused on innovative solutions, we provide software, data and analytics to support customer acquisition and risk management needs of our clients. Our solutions drive lending businesses through the entire credit cycle, that is from ‘planning’ to ‘write – off’. Our services include credit reports, credit scores, portfolio monitoring, Bank Verification Number (BVN) discovery service, market insight report, gap analysis, campaign report, enhanced Search List, skip rracing report, credit monitoring services, predictive analytics, Credit Risk management, custom solutions, consultancy, training and more. With our latest credit score release, branded SMARTScore V3, everyone in our bureau has a credit score. Our SMARTScore summarises the credit performance of a borrower to help lenders make fast easy credit decisions. Our company Founder, Taiwo Ayedun, was an immigrant to America. While living there, as a college student, he was given a credit card of $500 from Chase. He was amazed that in a country where he was not from, a bank trusted him enough to give him a loan. His story demonstrates that everyone needs credit and there are so many stories like this across Nigeria and across Africa as a whole. So, the question was obvious – “Why are banks in America and other developed countries so trusting to give credit?” It is because banks share credit information and they know how each person performs with credit. So, how can we help banks in Nigeria to be able to confidently give more people access to credit? That’s the question that gave birth to CreditRegistry. Thereafter, we pioneered Nigeria’s first private credit reporting system so banks can share credit information just like developed economies do. At CreditRegistry, we believe everybody deserves the right to have access to credit to improve their standards of living and expand their businesses.
Challenges
Having been at this business now for 16 years, we know that challenges will come and go. While we work to solve challenges, we do not focus on them too intently as a limitation. Honestly, the opportunities far outweigh the challenges; hence, that becomes our biggest challenge – how to select and fund the best opportunities in front of us. As a private sector company, the initiatives we prioritise help lead to more innovation which is better for our customers and the economy. You know that saying, “Your reputation proceeds you.” Well, as long as CreditRegistry continues to do what it was created to do, we will make that saying true for millions of consumers and businesses throughout Nigeria. When consumers and businesses can be recognised as being accountable in the credit ecosystem, they can be better trusted by service providers and lenders around the world.
Patronage
The best way to grow in a harsh economy is to innovate and provide a quality service. Innovation is part of our DNA. As the pioneer credit bureau in Nigeria, we were five years ahead of regulation and had to learn the hard way what it takes to get patronage. We focused on our clients’ needs and delivered quality service to fill those needs. Our clients aim to grow their businesses in more efficient ways to survive in a harsh economy, and we must be ready with solutions to help them. To accomplish this, we take our responsibility seriously to remain the thought leader and innovator so all our clients can benefit. CreditRegistry provides all its software, data and analytics services with speed, quality and reliability ensuring creditors can always be effective in their day to day lending operations.
Loan acquisition for SMEs
SME financing is essential for an effective economy. SME is a diverse area for lenders to manage and assess but the principles and approach should be consistent with the approach to consumer lending – use CreditRegistry software, data and analytics. The challenge is handling different types of SMEs ranging from sole proprietors, partnerships through to small and medium sized organisations in a consistent manner. Issues include how to differentiate between a consumer and a sole proprietor or partnership as often their personal and business financial situation will be closely linked. Therefore, for small businesses, lenders often question about how many directors should it check in addition to the business financials, etc. An additional consideration lenders face is the different type of financing that SMEs require over and above loan financing. Facilities could include invoice financing, trade credits, overdrafts, leasing, hire purchase and more. These products are quite different to basic consumer finance products but use of software, data and analytics can support effective SME lending services.
Addressing competition
Being the pioneer in our industry, five years ahead of any competition, we welcomed new credit bureaus when they began operations in Nigeria. Competition helped our clients differentiate value which enable us to increase our prices, innovate to deliver improved features and sustain our business with long-term customers. Like other developed countries, Nigeria only has a few credit bureaus – three to be exact: CreditRegistry, First Central and CRC. A limited number of credit bureaus is important in any country because it helps reduce information asymmetry. If data becomes very fragmented across many bureaus, the value derived will be diminished and lead to greater risk to lenders, depending on the information. This is the first year whereby the Credit Bureau Association of Nigeria (CBAN) will open its conference to the public. As CBAN Chairman, on behalf of all our members, I invite consumers and SMEs to come and interact directly with all the licensed credit bureaus, attend a masterclass with online lenders, participate in an exhibition and experience a concert with some of Nigeria’s best musical artists and comedians. Sponsoring events like this conference is the power of our cooperation in a competitive market.
Promoting Nigerian SMEs and entrepreneurs
The Nigeria Government can help promote and encourage SMEs and entrepreneurs by providing an enabling environment where SMEs and entrepreneurs can have access to affordable credit and this can add value to the economy, improving GDP and correspondingly contribute to more employment and improved standards of living.
