Mobile Money has brought with it several savings and loaning products, and through Mobile Apps, the loaning products have taken a new angle. Peer to peer lending and straight bank oriented loaning mobile app based platforms have emerged, and one of these loaning platforms is Branch Loans App. Today, the Branch Loans App boasts of over 100 thousand downloads in East Africa through which it offers personalized loans.
The performance of Branch Loans seems to have attracted the attention of Silicon Valley based venture capital firm Andreessen Horowitz that has injected approximately Kshs 1 Billion ($930 million) to help Branch expand its presence to the rest of Africa.
Branch states that it is a new way to access credit in East Africa where borrowers can use their Android devices to fill out a simple application for an affordable and convenient loan that is delivered directly to the borrower’s mobile money account.
With the funding from Andreessen Horowitz, the Mobile Loans App based lender will now be able to provide its convenient services throughout Africa, giving it an opportunity to scale both horizontally and vertically, “The combination of smartphones, digital money, and machine learning offers an opportunity to leapfrog old-fashioned credit infrastructure, and that’s precisely what Branch is doing”, said Alex Rampell, the Andreessen Horowitz partner who invested on behalf of the fund.
Branch currently offers loans through Google Play Store only and has grown to cover Tanzania and Kenya since its first loan disbursement that started in Tanzania in May 2015. Branch was founded by Matt Flannery who is also behind the founding and running Kiva.org, the micro-lending website that today operates across 80 countries.
According to statistics revealed by Branch, around 150,000 people in Kenya alone are already using the Android App. Other statistics indicate that on average Branch Loans customers borrow between shs 250 and shs 50,000, with the branch loans receiving approval in five or less minutes. “Over the last few months we’ve been growing rapidly”, Matt Flannery said. “With this latest round of funding, we’re able to expand further to meet the huge demand for our credit product in Kenya and enter new markets.”
Interestingly, Branch does not rely on tangible credit history for its first customers. Rather, it calculates a credit score for its customers by analysing information on their phone such as call and SMS history. According some of Branch customers, maximum Branch Loans available to first time customers is Kshs 1,000 and from there, customers can increase their credit limits through prompt repayment of loans.