‘Commitment, dedication crucial to business growth’

Jibro

Jibro

For two days the world literally stood still at the Slush 2016 for the best innovative techy-startup businesses in Helsinki, Finland. But only two Nigerian firms were among the almost 18 participants across the world at the conference. Victor Jibro, the Co-Founder of PayConnect, an Abuja-based startup, and Adaeze Sokan, the Programme Associate Manager at Venture Platform, also in Abuja, the hub through which PayConnect was selected, in a two-part interview with CLARA NWACHUKWU, spoke about the rigorous process of selection and why their ideas stood out.

How do you feel being the only Nigerian start up entrepreneur attending slush?
I feel very excited. There was an application of about 200 people, screened down to 15 then 10 then three, then one.

What do you think distinguished you from the rest?
Where I come from, Abuja to be precise, most investors look for seriousness and commitment. I think when we went for the competition they connected with the business, particularly as it was already generating revenue and I think this showed that we are serious in business, and suddenly we were selected. We started the business three months before we pitched, and we already had the elements working for us. I think that stood us out.

It is not easy for startups in an environment like Nigeria, considering the current recession, how are you surviving?
My start up is called PayConnect. We are an online lending service. We lend to employees and online shoppers. In recession Payconnect is striving more because people need more money. As a lending service we find out that the recession actually works to our favour.

It is interesting that your business is striving in recession especially as you target the unbanked and those in the rural area.

How do you reach them?
There are a lot of things to consider, especially the population of Nigeria. We are a country of more than 180 million people and only 20 million have bank accounts. There are about 160 million people who cannot work into a commercial bank to get loans, so when we reach out to communities especially those into cooperative collections; we find out that what they lack is technology. So what we did was to enable the cooperatives with technology on board their members so we lend to them. So it is much easier to reach out to people in the rural areas because we had first reached out to the cooperatives.

How do they pay back?
For the cooperatives, they stand as surety for them, we look at cooperatives that have about N1 million turnovers monthly. We give them about 20 per cent of that to lend to the people and when they lend they pay back. Even if the lenders have not paid, the cooperatives pay and go after the lenders.

Why did you decide to go into lending?
I spent 10 years in the commercial bank. I started by career in 2005. While I was in the bank I see that people come to the bank to request for loan as low as N10, 000, these people are made to go through long queues and even provide collateral at the end of the day they are not even given. So when I left the bank I embarked on a research to see why banks are not lending. They are not lending to them because they are not confident that the people will pay or they are so large and it requires much operational cost to reach them. I left the bank because the banking sector for me was monotonous and I needed to do something that will impact. Though this is still part of banking, but it gives flexibility and feedback to ensure that I tailor the right product to the right people; being in the bank won’t allow me to do.

You are using digital channels and you are targeting the unbanked, who do not have access to infrastructure, especially internet, how do you reach out to them?
We may have a large population of people, who are unbanked. But this same population use mobile phones, so we actually using mobile phones to reach those who don’t have bank accounts.

What is your rate of success?
At the moment we have only default of about 1.5 per cent and success rate of 98 per cent.

At the extreme cases what do you do if they don’t pay?
It is left for the cooperatives to follow up because we share the income with the cooperatives. The cooperatives are left to pay us at the end of the month, so it is left to the cooperatives. It is more or less like collaboration.

What is your growth for now?
Right now we are at 2,000. We hope to grow and expect to hit 10,000 by end of December. We already have collaboration with about 10 cooperatives that will be covering more than 10,000, so we are sure of getting to that number this December. By June next year, we hope to reach 500,000 and by December next year we would reach one million.

What are you doing to expand?
Apart from the unbanked, we have people who have full employment coming to us. Our disbursement period from application is 24 hours, but I tell that we disburse within three hours.

The essence of Slush is about business prospects, the reach and the organisation, how do you hope to scale up?
The programme has given us insight to grow globally. Before now, we are capturing only the Nigerian market but we are going to scale up to other Africa countries that have similar challenges with credits like Nigeria. Even in Nigeria, apart from reaching the unbanked, we are also reaching the employees and the online shoppers. Online shoppers usually don’t have money if they go online to shop and they abandon that shopping so what we have done is to provide facilities to them. The e-commerce sites release items to them and we follow up. In terms of reach, we are trying to capture all segments of the Nigerian market that require credit. We are also looking at India and Asia

How did you come in contact with the Finnish Foreign Affairs?
I have an office in Wuse 2 in Abuja, and was thinking of moving to Venture Platform. When I told them about my business they encouraged me to apply to Slush. It was like two days to the end, luckily I was picked two weeks after I pitched. So after necessary processes I was sent an email inviting me to Slush. I am currently an incubator in that hub.

You are already in the business before you set up, why did you think it was necessary to incubate?
If you look at incubation as a word you may say we have passed that level, but we were doing things based on how we understood it. Going to Venture Platform to incubate was more or less like a path to growth. We were taught a lot of things that would have taken us like three years to know. Within our three months, there we were able to rebrand Payconnect to what it is today. The platform enabled us to scale faster and to reach out to more people.

How many people have you employed?
Including myself, we are five. We also have people on the field.

What is your reach?
We are presently focusing on the states surrounding Abuja. We are gradually expanding across the country. Before mid-next year, we would cover 15 states in Nigeria, and by December, we should cover all.

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