Supporting new concepts to enhance the uptake and usage of financial services by the low-income population in Nigeria through leveraging on financial technology delivery channels provided by the FinTechs. EFInA is pleased to announce its ninth request for proposals (RFP 9) for the Fintech Challenge Grant which focuses on supporting new concepts to enhance the uptake and usage of financial services by the low-income population in Nigeria through leveraging on financial technology delivery channels provided by the FinTechs.
EFInA recently launched a new Challenge Fund that will be used to pilot and support the development of innovative financial products & services through the use of digital technology. In addition, this Challenge Fund which comprises the Fintech Challenge Grant will fund projects that help strengthen financial resilience in Nigeria by aligning innovation and modern technology with the needs of the target audience. The objectives of the EFInA Fintech Challenge Fund are to provide financial services that are accessible to everyone especially the low-income segment, improve customer experience, enhance the transparency of financial services and increase the adoption of financial services with reliable and affordable products. In addition, the major purpose of this fund is to target FinTechs with innovative and cost-effective solutions to overcome the challenges or obstacles hampering financial inclusion in Nigeria.
The funding information for the Fintech Challenge Grant are as follows:
- $50,000 – $200,000 for Start-up FinTechs – Fintech Challenge 1 Grant
- $200,000 – $500,000 for Growth stage FinTechs – Fintech Challenge 2 Grant
The impact of the financial technology wave is becoming broader with emerging innovations. FinTechs would, therefore, need to leverage on the opportunities in the Digital Financial Services space. Digital Financial Services can be accessed via innovative technologies like mobile-phone enabled solutions, electronic channels and digital payment platforms.
The EFInA Access to Financial Services in Nigeria 2016 survey revealed that there is a significant opportunity for FinTechs in Nigeria as 71% underserved adults indicated that they are interested in adopting a new financial technology.
- 19 million (38.4%) of the informally served and financially excluded population own a mobile phone
- 71% of the underserved adults mentioned that they are prepared to use new technology
- 33 million adults are willing to learn how to use new technology
- Over 20 million adults are open to the idea of using financial technology to manage their finances
Some of the active areas of FinTech innovations revolve around the unbanked and under-banked, services that seek to serve disadvantaged or low-income people who are underserved by the traditional banks or mainstream financial services companies. Fintech services are positively disrupting a variety of industries because of its focus on leveraging technology to improve the delivery of financial services and make them more accessible to the general public. In Nigeria, offering financial services through digital platforms is still in the nascent stage with a primary focus on payment services.
Some of the constraints to the development of Digital Financial Services include weak cell coverage, power infrastructure, slow product development, poor agent network liquidity and expansion and low awareness of customers. EFInA is focused on leveraging financial technology services to deepen financial access and therefore seeks to fund projects that will extend financial services to the low-income population in Nigeria (defined as those earning N50, 000 or less per month). Successful applications will provide a compelling use case that meets the needs of the low-income population by offering different products through a range of channels and financial access points. Applicants are therefore encouraged to consider the relevance and affordability of the financial technology services offered.
What is EFInA looking for?
Focus area: FinTech projects proposed should cover most financial services, in particular savings, investment (commitment savings), payments, lending and insurance, but also enabling technologies.
Thematic Areas: the thematic areas cut across the four stages of the Fintech Innovation Life Cycle: Garage (Idea formulation Phase), Innovation Hub (Developing initiatives Phase), Accelerator/Business Building Phase and Market Building. This includes FinTechs offering valuable services to support any of the thematic areas.
- Thematic Area 1 (Fintech Challenge 1 Grant): Development of Initiatives aided by the formation of clusters and refining ideas to bring about innovation (i.e. Garage and Innovation Hub). Designing Financing and Risk Mechanisms to manage challenges with product and technology development.
- Thematic Area 2 (Fintech Challenge 2 Grant): Creating platforms that facilitate savings, electronic payments, loan disbursements and collections, etc. with products market ready for pilot and roll out.
- Applicants must have a track record of success for providing financial technology services
- Applicants must provide a strong business case that demonstrates how the proposed products/services and channels meet the needs of the low-income population (defined as those earning N50,000 or less per month)
- Applicants must develop effective customer awareness campaigns that demonstrate the benefits of the products/services. and provide information on agent locations, if applicable
- Applicants must indicate that they have the capacity to implement the proposed project and demonstrate sustainable impact within 12 months
Who can apply?
- Eligible organisations are start-up and growth stage Fintech Companies in Nigeria offering innovative financial services solutions that promote financial inclusion
- Applicant should be legally incorporated within Nigeria
- Have the capacity to implement the proposed project for the applied funding and evidence
- that the business is viable
- Applicant should have 2 Guarantors to provide a formal assurance, especially that all project conditions agreed by EFInA and Applicant will be fulfilled
- The EFInA Fintech Challenge Fund is open to proposals around two thematic challenges and a special focus area. Individual projects may focus on one or multiple thematic areas. A clearly identified need or problem and a practical application of the proposed innovation will be important for a successful proposal
- All proposals need to demonstrate a new or different approach which requires funding from the challenge fund to get off the ground, and the proposal should demonstrate why this could not be supported from the Applicant’s funding sources. Ensure that all approaches are scalable
- All products and outputs should show a clear path to ultimately be operationalized on-the-ground
How to apply?
All applicants must complete the EFInA Fintech Challenge Grant Application Form. For further information on the application and submission process, please click here. All completed grant application forms, templates and required documentation should be submitted by 5 pm on Friday, November 16th, 2018. Shortlisted applicants will be notified of the outcome of their applications by Friday, November 23rd, 2018. Shortlisted applicants will need to complete the second round application forms and required documentation by Friday, December 7th, 2018.