Two entrepreneurs to unveil Nigeria’s first ever online lender in New York on Thursday.
The digital bank, Lidya, will have no branches and will be based in Lagos, Nigeria’s commercial capital. According to a report from Bloomberg, the digital bank will focus on small and medium-sized businesses and offer loans between $500 and $15,000.
Tunde Kehinde, a co-founder said Lidya will initially focus on Nigerian customers, but will also target cities across the African continent.
“There are no real products catered to these customers today,” Kehinde said by phone from New York, where he’ll announce the formation of Lidya at a financial technology conference. “What we’re trying to do is introduce a lot of technology, algorithms and machine learning to industrialize the credit assessment process.”
Kehinde graduated from Harvard Business School and was a former managing director of Jumia, Nigeria’s biggest online retailer. Currently, he runs Africa Courier Express with Ercin Eksin, other co-founder.
The two majority owners will be looking to bring other shareholders on board to raise more than $1 million in the next few months from investors in the U.S., said Eksin.
Lidya will be opened officially next month for business and planned to partner Nigerian banks to allow them use it as a platform to reach small businesses.
“Because of how the banks are set up, with bricks and mortar networks, they’re more inclined to service multinationals and large government institutions,” Kehinde said. “Their cost structure isn’t favorable to servicing small businesses. Because we’re using technology and algorithms to assess the risk, it allows them to offer financial products to these customers at a low cost.”