Mastercard and Unilever Join Forces for Banking Inclusion

Mastercard and Unilever announced a strategic partnership for helping small businesses grow in Kenya. They will be proposing low-interest loans, relatively similar to cash advances for micro-entrepreneurs, customers of the Dutch supplier. They will no longer have to rely on informal lenders where high interest rates apply.

The new digital lending platform called Jaza Duka (“fill up your store“) builds on Unilever distribution data and on Mastercard’s digital payment solutions.

Mastercard relies on transactional data gathered by Unilever to assess micro-entrepreneurs’ eligibility. Their credit score mostly depends on how much merchandise they purchased from Unilever over time. These results will then be sent to Kenya Commercial Bank, in charge of approving (or not) the micro-credit line.

After a successful test phase, Mastercard and Unilever are planning to provide 20,000 kiosks in Kenya with a digitally managed credit solution by the end of 2018. They also expect to extend their solution on other African and Asia Pacific markets.

Comments – Aiming for small merchants in Africa

Nearly one month after they joined forces with Facebook on proposing a Messenger-based payment solution in Nigeria, Mastercard further stresses their interest in addressing un(der)banked African micro-merchants. With this partnership the card scheme focuses on improving access to credit facilities, avoiding that merchants should rely on informal lenders they may not be able to repay. Likewise, just a few days ago, Twiga Foods started proposing micro-loans for African entrepreneurs. Unlike Jaza Duka, this service designed by a logistic platform relies on IBM’s Blockchain for credit-granting processes. The point stays the same: enabling access to micro-credit via relying on mobile devices and alternative scoring tools.

Mastercard and Unilever confirmed that the test phase has been successful with a certain number of customers: sales figures for some of these merchants would even have increased by more than 20%. Through their partnership, they also intend to train micro-entrepreneurs: help them manage their finances, inventory and forward planning for supply against demand.