Nigeria’s Toju provides alternative credit scoring services for the unbanked

Toju, a Nigerian fintech company, has built a record management platform for local savings clubs, thrift collectors, microfinance institutions, and cooperatives to provide alternative credit scoring for the unbanked.

Toju was created by Olaide Oladipupo, Byron Neji, and Sodiq Tijani in 2019 during a pre-incubation programme conducted by Accion Venture Lab with the objective of bringing traditional savings clubs into the digital era and enabling its members to access financial services.

“In Africa, while selected people use bank branches, ATMs, and USSD, the vast majority makes use of a different kind of banking, services that have existed since even before colonial times, one that involves an agent going from door-to-door collecting cash deposits and sometimes fulfilling withdrawals at the end of the month,” Oladipupo told.

However, these systems are inefficient, with frequent mistakes, complex data retrieval, and a daily reconciliation time of 90 minutes on average.

“And because all their customers withdraw at the same time each month, they would not be able to fulfill their other clients’ demand for a loan,” said Oladipupo.

Toju wants to automate the entire procedure.

“We are onboarding these agents onto our platform, which automates all their daily processes. Plus, with our machine learning, we are able to study their customers’ savings behaviour, and provide them the liquidity they need to power their business,” Oladipupo said.

Over 120 agents work for the self-funded firm, which serves roughly 10,000 people and small companies. Toju takes a tiny share on loan returns and charges agents a monthly subscription fee.

“Since inception, we have disbursed loans of over US$1 million to small businesses,” said Oladipupo.

“We are currently only operating in Nigeria with our sights on other African markets with similar structures.”