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Kenyan startup shakes up fintech

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Kenyan startup shakes up fintech

Kathy Gibson at VMworld in Barcelona — A Kenyan startup is leveraging the cloud to shake up big data, fintech and agritech in its home market and the broader sub-Saharan Africa region.
Intelipro is barely two years old and already it touches literally millions of individuals with its automated risk profiling solutions for micro-finance, payment systems and agriculture.
Leonida Mutuku, the 28-year-old founder and CEO of the 10-man organisation, set up the company because she wanted to use her degree in actuarial science and experience working at the Nairobi innovation hub to develop solutions for African companies.
“I have always been very interested in computational models and big data, but I didn’t want to use data science from a research perspective; I wanted to do something practical to support African companies, especially SMEs, and help them improve efficiencies.”
Intelipro’s main focus areas are in the financial and retail sectors, with a particular emphasis on financial institutions that run micro-finance initiatives.
“In the age of mobile money and digital wallets, you don’t have to be a financial institution to get access to a wealth of rich data,” Mutuku points out.
Intelipro uses this data to build automated risk profiles that credit providers can use to determine various micro-finance parameters.
“For instance, our micro-finance lending platform allows us to connect with different data points that customers expose to us,” she explains. “We are able to use that data, then apply machine learning and modelling to come up with credit scores, credit limits, and what interest rates should be applied.”
Micro-finance is a huge market in Africa, and financial institutions are keen to work in the space. “We are helping to them to actively analyse customer engagement to target customers, segment them and understand the cross-selling opportunities.”
Intelipro has developed its systems and algorithms from scratch using open source tools like Python. The core team of 10 people is mainly data scientists and engineers, and much of the development work is outsourced as needed.
The systems run on a managed cloud infrastructure from Node Africa, another Kenyan startup.
“Node Africa is an interesting partner because we are growing together,” Mutuku says. “It is a local company that offers us managed services, so we don’t have to worry about the daily operations. We can focus on putting our applications into production rather than looking after the infrastructure.
“In addition, they have been very reliable. We have not had any downtime, and there is limited latency on the network.”
Intelipro has made sure its systems are productised rather than bespoke for each customer, so they are relatively easy to implement and run. “We are trying to make these platforms almost like software as a service (SaaS),” Mutuku explains.
The company’s financial customers include banks and microfinance institutions as well as payment aggregators looking to add services.
The reach of the Intelipro services is immense. Mutuku says the individuals who are touched number in the millions, from about 5 000 people targeted by the smallest customers up to 4-million targeted by the largest, a bank in Ghana.
And the company already operates in Kenya, Swaziland, Ghana and Nigeria, with plans for further expansion.
“In Africa a lot of people are still not banked,” Mutuku says. In fact, Kenya — along with South Africa and Nigeria – is something of an anomaly on the continent in that it is quite well advanced in terms of financial inclusion.
“It is relatively easy to build other products in top of M-Pesa,” she explains. “And M-Pesa has also opened other opportunities, allowing us to extend services to all M-Pesa customers.”
Despite the depth of financial service penetration, it’s not yet a mature market, however, so there are still opportunities for new financial products.
“But once you step out of the borders of Kenya, South Africa and Nigeria, there is an entire continent of opportunity in the financial and retail spaces. We are seeing opportunities and interest in Ghana, DRC, Uganda and more.”
On a slightly different note, Intelipro works with the East Africa Farmers’ Federation to support small farmers, helping them to be as productive as possible while aggregating their output to be more commercially viable.
The federation represents 20-million soy, maize and bean farmers in the region.
The solution from Intelipro is E-granary, a mobile platform that uses USSD so all users, including those with older feature phones, can access the app.
On first logging in, farmers record the size of their farm and the group of region they belong to. During the year, they keep a farmer’s diary, logging agricultural data as well as administrative data like workers’ salaries.
At harvest time, they record how much they harvested.
Throughout the year, the system uses a variety of data sources to record weather, soil conditions and more. Advanced analytics are employed to determine how much credit farmers require, and what inputs the need to maximise their yield.
For instance, the system will determine the amount of seed or fertiliser that is needed, and this will be made available to individual farmers in the form of credits.
Once they’ve harvested their fields, the system will calculate their net revenue and can advance them cash against their yield.
“The current version of the product supports farmers with financial services, but where we are going is to help them improve productivity through the data we aggregate. The next step is to give them real intelligence that will assist them in improving their farms.”
There are currently 25 000 farmers using the system, which has given out about $150 000 in credit so far.
“This use case is close to our hearts because of the impact it has,” Mutuku says. “We are not looking just at Kenya with this solution, but will soon move into neighbouring countries as well.”