Nigerian fintech startup, Creditchek is helping lenders mitigate credit risks by reliably verifying the creditworthiness of potential consumers in Africa.
Founded in November 2021, Creditchek has developed an easy-to-use web app and API that leverages machine learning to turn raw data from multiple sources into actionable insights that lenders can use to strengthen their credit risk models.
“It is not uncommon to find African consumers taking loans from multiple lenders simultaneously, eventually leading to over-indebtedness, and the lack of symmetrical information sharing in the lending ecosystem to identify repeat offenders leads to loan stacking,” said Kingsley Ibe, the startup’s co-founder and business lead.
Creditchek looks to address this issue, allowing lenders to more easily verify the creditworthiness of borrowers, which mitigates risk for them and in theory allows more deserving people to access loans. The African credit market in certainly a major one, with McKinsey & Co valuing it at US$1.7 trillion, growing 6.2 per cent year-on-year.
Ibe said Creditchek, which charges a fee per transaction and currently operates in Nigeria, was planning to tap into this market continent-wide, and aims to expand to Rwanda, Kenya and Ghana by 2025.
“Since we went public in July 2022, we have grown 14 per cent quarter-on-quarter, processed over US$200,000 and generated more than US$5,000 in monthly revenue. Furthermore, because we have maintained a low burn, we expect to break even in the second quarter of this year,” he said.
Creditchek had to overcome initial challenges to reach this point, but is now fundraising for its next stage of growth.
“At first, we had challenges partnering with some of our stakeholders, however, with the help of our existing investors, we were able to figure out a workaround and eventually overcome those challenges. In terms of scaling forward, we would have to do more than just provide insights, which is why we are looking to raise US$1 million to scale the new products we have built and acquire new customers.”
