The path to financial freedom shouldn't be a privilege reserved for the few, but a right accessible to all. Chilufya Mutale-Mwila, co-founder and chief visionary officer of eShandi, is on a mission to make this vision a reality across Africa.
Growing up in Zambia, Chilu witnessed firsthand how access to financial services could transform families and communities. After joining a microfinance institution as an intern, she spent six years immersed in understanding the challenges faced by small business owners in underserved communities. This experience, followed by leadership roles expanding fintech operations across Southern Africa, revealed both the power of technology and the limitations of existing financial models.
The breakthrough came when Chilu realized that combining the efficiency of technology with the personalized approach of microfinance could create something revolutionary. eShandi (meaning "mine" in local language) was born as a pan-African challenger bank putting financial power directly into customers' hands. The company serves those often overlooked by traditional banks – market vendors, cross-border traders, and small-scale entrepreneurs who operate primarily in cash economies without formal financial records.
What makes eShandi's approach unique is their deep understanding of customer needs. Rather than forcing digital-only solutions on communities accustomed to cash, they've created accessible pathways to financial inclusion. Their impact is measured in tangible success stories – women expanding from one market stand to three, entrepreneurs purchasing their first delivery vehicle, or families buying their first refrigerator.
With operations in Zambia, Zimbabwe, and South Africa, Chilu has ambitious plans to expand eShandi's reach and services. The vision of "banking without borders" aims to connect African entrepreneurs across national boundaries, allowing seamless transactions and expanding opportunities. By adding insurance products, remittances, and new market entries, they're building a comprehensive ecosystem for financial empowerment.
Ready to discover how innovative financial solutions are transforming Africa's economic landscape? Listen now to learn how eShandi is bridging the $330 billion financing gap and creating pathways to prosperity for underserved communities across the continent.
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Episode Transcript
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Speaker 1 (00:01):
With more female entrepreneurs than any other
region in the world.
Women are at the heart ofAfrica's transformation.
Welcome to African BusinessStories, the show that amplifies
the voices of femaleentrepreneurs shaping Africa's
business landscape.
I'm your host, ekego Koye.
Here we explore bold ideas,strategies for scaling and the
(00:25):
realities of building businessesthat drive economic development
.
These stories will provideinsights into Africa's business
landscape, practical tools forgrowth and the inspiration to
navigate your ownentrepreneurial journey.
Be sure to subscribe, rate andshare Neuro journey.
(00:51):
Be sure to subscribe, rate andshare On the show.
Today I chat with ChilufiaMutale-Muila, co-founder and
chief visionary officer atEchadi, a pan-African challenger
bank, transforming financialaccess for small businesses and
female entrepreneurs.
With a background inmicrofinance and fintech, chilu
has spent over a decade workingto bridge the financial
(01:11):
inclusion gap across Africa.
We talk about her journey fromZambia to leading fintech
expansion across multipleAfrican markets, the challenges
of navigating regulation,raising capital, and how Ashadi
is redefining financial servicesfor underserved communities.
It's a conversation aboutinnovation and the future of
(01:33):
banking in Africa.
Let's get into it.
Hi, chilu, welcome to AfricanBusiness Stories.
Thank you so much for having me.
I'm happy to be here.
I normally like to start fromthe very beginning.
We like to say let's start fromwhere it all began.
And I know that you're fromZambia, which is in Southern
Africa, and I wonder if youwould share maybe some
(01:56):
interesting facts that maybe ourlisteners don't know about
Zambia.
I've read quite a few and it'squite interesting, so it'd be
good to hear from you someinteresting facts about Zambia.
Speaker 2 (02:06):
I've read quite a few and it's quite interesting.
So it'd be good to hear fromyou some interesting facts about
Zambia.
Zambia is known for its warmhospitality.
It's noted to be one of thefriendliest nations in the world
.
It's a beautiful and diversecountry.
We are home to the VictoriaFalls, one of the seven natural
wonders of the world.
Locally, we call it theMothiotunia, which means the
smoke that thunders, and it'salso one of the world.
Locally we call it theMosiotumia, which means the
smoke that thunders, and it'salso one of the most peaceful
(02:27):
nations across Africa.
Speaker 1 (02:29):
So, in terms of growing up, I know you were born
and raised in Zambia.
Are there any childhoodmemories that have stayed with
you over the years?
Speaker 2 (02:37):
One of my fondest memories was with my parents.
Both my parents are deceased.
My mother left when I was onlybarely seven and I was raised by
single parents, so my fondestmemories were with my mother and
dad, and each time we'd receivevisitors, especially our
grandparents, our parents, wouldput us all in the middle and
then we'd start dancing andthey'd be clapping for us.
(02:57):
So it was always a competitionfor us kids who would dance the
most, the best, and I alwaysloved the fact that they always
really cheered for me and theywere so happy with how I was
dancing.
I don't remember how I wasdancing, but I was always giving
money.
So that's the only time youever got money when visitors
came and then you dance and thenthey'll give you, give you
things.
So those are the fondestmemories of how, as a community,
(03:18):
as a family, we come togetherwith children.
It's something that I don't seeso often because we're all
working, we're so busy, we'reall living our own lives and we
get to see each other whenthere's a funeral or there's a
gathering, there's a wedding andthings like that, but not those
associations where grandparents, grandchildren, the parents all
together.
It's a different lifestyle thatwe live in today, I agree.
Speaker 1 (03:41):
So just moving on to university, I know that you
studied natural resourcemanagement, is what I read.
Yes, how did you come to studythat?
Your career is far from that,but we'll come to talk about
that.
But how did you come to studythat?
Speaker 2 (04:07):
actually wanted to do computer science and but I
didn't make the cut and so Iwent to the second choice and
then in the second choice option, basically there wasn't any
opportunity for me to sit intothat class because this all the
seats were taken up by peoplethat have put it as the first
choice, and so I ended up in aclass that was basically
studying physics and, oh mygoodness, it was so off for me
that I flunked.
I was put on an extra programwhere I had to go home, sit out
(04:31):
a semester and then come back,and that would mean me losing my
bursary.
I was sponsored by thegovernment.
I was on a governmentsponsorship and and so my
lecture basically one of mylectures in physics said you did
so well in my course.
I don't see why you have to gohome and then lose your bursary.
How are you going to come back?
How will your father pay forthis?
And that's how he pleaded withthe dean of one of the other
(04:53):
schools in natural resources tofit me and squeeze me in.
And that's how I ended up doingnatural resource management.
I have no idea about what Istudied, because I've never
applied even any single part ofit in my life since I graduated.
Speaker 1 (05:11):
Yeah, in 2009.
So then you finished yourdegree.
And then what?
Speaker 2 (05:17):
How did you end up in microfinance, and so
microfinance, I had stayed homefor one year after graduating.
I looked for multiple jobs,applied for many jobs, but the
first interview that I got thatjob and it was in a microfinance
company and I applied for a jobas an intern.
And that's how I really got tolove what I really do.
The beauty about the internshipI was made to go in different
(05:40):
markets, different parts of townto understand from people who
were doing business what theirpain points were, what problems
they had and how could afinancial institution help solve
those problems.
So we're carrying out aresearch to see how we can
provide impact and providefinancial support to small
business owners and ininteracting with people.
(06:01):
That's where the passion reallyderives from, because the
microfinance institution waspreviously an NGO and their
mission and vision was clearlyto alleviate poverty, but to
access to easy and affordablefinancial services so that they
can basically socially improvethe lifestyle and the
livelihoods of people.
Because these are the people whoare at the base of the pyramid
(06:23):
segment, the mass market peoplewho were not really literate,
they couldn't sign on a document, they had no savings
opportunities, they had no bankaccounts, but these are people
who were trading and these arepeople who had homes and
children, and most of theirchildren were trading with them
because they could not afford totake them to school.
And that's common in mostmarkets, not just in Zambia.
(06:44):
And so that's common in mostmarkets, not just in Zambia.
And so that's where really thepassion derives from.
It is just through those hightouch interactions with people
and seeing the real impactbefore my eyes.
That's where it all came from.
Speaker 1 (06:57):
I had no academic micro finance background or
financial services, but that'swhere it all started yeah, the
learning is in the doing, isn'tit?
It really is in the doing, so.
So how long did you spend inmicrofinance?
Speaker 2 (07:10):
so I was in microfinance for six years uh
before evolving uh into afintech, and this fintech was
coming from eastern europe.
They were trying to test theiroperations in Africa and because
data is primarily fragmented inAfrica, you need to use
multiple sources of getting datafor you to then basically
(07:31):
provide a digital loan, forexample, to a customer.
It was very new in this market,so they headhunted me and gave
me a CEO role to basically setup operations for them in
Southern Africa.
I set up operations for theentities in Zambia, zimbabwe,
malawi, botswana, namibia and inZambia.
Basically, even getting alicense was really hard because
(07:52):
we had to explain to theregulator how we're going to
operate, differently from atraditional microfinance
institution.
We didn't have fintech back inthe day, and so just to get
regulatory buy-in as well asunderstand what kind of licenses
would be because our businessmodel is different from your
traditional microfinance model.
(08:13):
This is a digital platform,technology-driven.
How are you scoring customers?
How is the customer approvingand acknowledging the terms and
conditions?
How are they understanding?
How are you providing financialliteracy to this customer?
How are you managing to makemoney and avoid the risk of
default, especially that you'renot collecting physical assets
like the way a typicalmicrofinance would just
(08:35):
transform and evolve into that?
Speaker 1 (08:39):
So how did you personally make the transition
from traditional microfinancebanking to fintech?
Speaker 2 (08:45):
Honestly, it's the willingness and the passion.
Once you have that keeninterest and you see how you can
make meaningful impact, itbecomes easy to learn,
transition and then know how todo it.
So for me, I saw how successfulmicrofinance models work for
small business traders, informalthe informal sector,
(09:05):
particularly women and the youthin business.
But what I saw that was missingwas the efficiency and the time
.
So when people need workingcapital solutions, they need the
money.
Now I cannot come to you andask for funds and then it takes
me three to one month or twomonths for me to access those
funds, and then it shouldn'ttake me six months for me to
trade with you, for you to beable to give me a loan, because
(09:27):
you want trading history with meif I'm depositing with you.
So what people need is asolution that solves their pain
point at that time, and that'show you can have buy-in and
trust from the customer.
So, with the consumer lendingcompany, what they brought was
efficiency and speed, and Irealized that those were the
common problems and thebottlenecks we had as a
(09:48):
microfinance institution.
So it was easy to assimilatetechnology as an enabler to then
provide very quick andaccessible financial solutions.
And because technology is anenabler, I realized that it was
very cost effective.
Because you do need so manypeople to process application.
It didn't need to take so muchtime and so many processes
around.
(10:08):
The tech could be end-to-endautomated.
With scalability, someone caninstantly get financing, just
like that that's interesting.
Speaker 1 (10:17):
So you took this company, they took you, they
brought you in as ceo and youtook this company across
southern africa.
So just walk us through maybetwo examples of two, two CEO and
you took this company acrossSouthern Africa.
So just walk us through maybetwo examples of two countries
that you took this company intoand the differences you saw in
market entry.
Speaker 2 (10:32):
So you find that for markets like Botswana, the
regulators are different.
So for a financial institutionor a FinTech, basically there's
a different unit, separate fromthe reserve bank or central bank
, that manages, and so you find,like in other markets, it's way
more developed and certainprocesses can be done online and
(10:52):
it's very straightforward andwithin a specific time frame you
get your feedback, whether it'san approval or it's not an
approval.
In other markets, like Zambia,it took a rather longer process
and also because we were here.
Basically we had the patience tohave the back and forth
discussions and understandingand providing that clarity.
But for other markets that aremore developed, where fintechs
(11:16):
are already existing, theregulator is very confident of
how they operate.
They've created the frameworksaround it that govern it and
they bring it.
It becomes much easier toprovide you quick feedback and
the licensing and the governanceoperates.
They've created the frameworksaround it that govern it and
they bring sensitive.
It becomes much easier toprovide you quick feedback and
the licensing and the governancearound it because those
structures already evolved anddeveloped fantastic.
Speaker 1 (11:34):
So how long were you with the fintech?
Speaker 2 (11:36):
for I was with them for about two years so in total
I spent about nine years in thecorporate sector before taking a
leap of faith as anentrepreneur A real leap of
faith.
Speaker 1 (11:48):
I mean an unemployed person.
I know right, I know.
So what made you decide to makethat leap of faith?
Speaker 2 (11:57):
I really struggled around impact when it came to
the technology-driven business,because it really catered to
people that were alreadyfinancially included, because
there was already data that wasavailable to help the
institution leverage thatexisting information that is
verifiable to then provideinstant financing.
And then I missed out on theopportunity of where, with the
(12:20):
traditional, microfinance,institutions were serving small
business owners who didn't haveformal financial services, that
kind of access and financialhistory, credit history.
Even with the credit referencebureaus, there's zero
information about these kinds ofcustomers, and this is because
they borrow from your loansharks, your informal traders,
with high, exorbitant interestrates.
(12:40):
There's no financial recordabout these transactions because
they're mainly cash driven.
And so what I then decided waswhat if we can have a mix of
both, can't we have the best ofboth worlds and then serve the
customers that really need thesupport, who don't really have
the luxury of choice of pickingthree to four banks that they
can go to and shop for pricing,but they basically need a
(13:04):
financing partner that can growwith them in their business, and
we felt Ishandi would be thatpartner by getting the best of
both worlds.
Both institutions wereexceptionally good.
One was highly driven by tech,but we needed to use that tech
for the people that needed thefinancing the most.
And that's the math Right.
Speaker 1 (13:23):
Yeah, so when you launched this business, it was
called Premier Credit.
Speaker 2 (13:28):
Yes.
Speaker 1 (13:29):
And I've seen that there's been a rebrand to
Eshandi.
So what inspired the namechange and what does Eshandi
mean?
We?
Speaker 2 (13:36):
started off back in 2019 as Premier Credit and we're
providing many loans to smallbusiness owners in business, and
as we then startedunderstanding our customers
better and trying to solve thecustomers problems, their pain
points in their business journey, we realized that it's not only
a loan that they required, andparticularly for us as an
(13:57):
institution to build up ahistory of their financial
records.
We needed the customers totransact and we needed to
digitize their cash.
So how do we drive a customerfrom a cash-driven society to a
cashless society where they cantrust a financial institution,
they can pay their suppliers,they can make their purchases
(14:17):
via mobile money or their wallet, and then that kind of
financial linkage and that datacan be used to score a customer
and then understand theircapacity to pay, without even
the need for them to providework goods from their home, from
their shop or a house orvehicle and for most people who
don't have, they basically won'tbe able to access.
(14:38):
And so we then decided to thenadd additional financial
products so that we provide aholistic one-stop shop where a
customer can access a loan, cansave, can invest, can send money
, can pay and can get aninsurance product like the Horsi
Cash Cover.
And that is what now Ishandimeans, because we were creating
(15:02):
an opportunity for a customer toattain financial freedom by
becoming formally financiallyincluded and introduced into the
banking realm.
So we then put the bank, whichis our wallet, into the
customer's hands.
They can easily access it, evenwith a feature phone.
They can easily access it fromwhere they are, without leaving
their place of business.
(15:23):
They can transact and digitizetheir financial records on our
platform and be able to thenbecome financially included,
because we will then do theheavy lifting and put all that
information and update thatinformation even in the credit
reference bureaus, so that itbecomes easier for even other
financial institutions toprovide other services to them.
(15:44):
So Ishandi really means thepower is yours, in your hands,
and you have the power to attainyour own financial freedom and
build your own financial future.
Ishandi means mine, so thepower is with you and not with
the bank, but with you, theconsumer.
Speaker 1 (15:59):
That's fantastic.
That's a real fantastic storyand service that you're
providing.
What does your client base looklike today?
Speaker 2 (16:07):
So most of our clients are in the informal
sector.
These are previouslydisadvantaged income groups from
underserved communities,marginalized communities.
These are customers who are inthe informal sector that do not
have registered businesses butare small-scale traders.
Some of them are cross-bordertraders.
Some of them are who you'd callmarketeers, who are doing
(16:30):
general trade in the markets andhave small stores where they
are basically operating as wellas they also cater to the larger
extent SMEs who have formallyregistered their businesses and
have a few employees in theirbusinesses but are unable to
access the full extent oftraditional bank services.
Speaker 1 (16:47):
You have a very broad customer base.
What does repayment look likefrom these different groups of
customers?
Speaker 2 (16:55):
So you will find that repayment from customers who
have been historicallydisadvantaged is way better than
people who have access toformal financial services from
other financial institutions.
The reason being is you findthat when you're not really
spoiled for choice and when youfind a good product or service
that works for you, thelikelihood of you wanting to
(17:18):
build a good workingrelationship with them because
you can easily access futurefinancing from them when you
need it.
You want to build a good record, and so those kinds of
customers who always pay on timeand most of them would prefer
to make payments on a dailybasis because they are generally
trading, rather than payingonce a month because they'll say
I'll forget on that day, maybemy child is sick or I have a
(17:40):
funeral or have a problem, Imight forget.
They don't have diary recordedon the phone where something
happened, where they arereminded.
They would rather say I'm goingto save X amount every day.
How much do I need to save upevery day to accumulate to a
monthly installment?
So those are your best pairsbecause for them, they're
looking at the financial partner.
They started calling us a bankback in 2019, when we're not
(18:00):
even a bank.
Started calling us a bank backin 2019, when we're not even a
bank.
They called us a bank becausethey saw us as one-stop solution
, when we were only providing aloan product and all they see is
an institution that comes tothem.
We bring the financial serviceto them and we're solving their
problems with them, and weunderstand them.
I come from that same kind ofbackground so I understand, and
(18:22):
the employees we have also comefrom the same background.
My father also was a customerfrom the first company that
hired me, so he benefited fromthose services indirectly.
I benefited as a child from thathousehold because that small
business owners are able to taketheir kids to school if their
businesses are thriving.
If their businesses are notthriving, the economic growth
(18:46):
becomes stunted for a nation,especially in growing economies.
And even when it comes tohealthcare and food, you face
all these challenges because,trust you me, a small business
owner has to cover hospitalbills from the money they make
from that same business, has tocover food, rent, a roof over
their head from that same smallbusiness.
So imagine if it caught fire.
(19:06):
They didn't have an insurancefor that.
Imagine if they were safe.
Imagine if they didn't haveworking capital to grow Everyone
.
There's a whole chain, a rippleeffect that gets affected just
because of one small business,and I'm a product of a
successful story like that.
Speaker 1 (19:22):
So how do you raise the money to be able to at least
offer these loans and all theother products you offer to
people?
Speaker 2 (19:30):
So raising funds has been a challenge for us, one of
the constraints we faced.
We were, fortunate enough,after we launched our operations
in 2019, after 18 months oftrading, we were able to raise a
stage investor from an earlystage investor.
They are a gender-line focusedfund and they gave us $650,000
in 2020, and they gave usfollow-on investment of about
(19:52):
$1.5 million and in total, theygave us close to $3 million in
funding.
And from that time back in 2020, we only further raised an
additional $2.5 million from animpact lender, a Swiss fund.
And then we then innovated bylaunching a peer-to-peer lending
platform to the regulatorysandbox of the Securities and
(20:14):
Exchange Commission.
Primarily, the sandbox was tohelp us provide working capital
to small business owners, butusing funds from the local
market rather than raising moreequity or debt from venture debt
from VC.
So we launched this platformthat could easily allow us to
connect people who had money andwanted to earn some passive
(20:35):
income to people who were inneed of financing, and we
connected them to our platform.
We had raised over $6 millionthrough that platform and so in
total, we raised about $11.8million to date.
We are currently raising aseries of rounds of $15 million.
We are looking for equity aswell as debt and looking for
partners to join us as we expandinto other markets in South
(20:59):
Africa, kenya, zimbabwe expandinto other markets in South
Africa, kenya, zimbabwe andwhere we are in Zambia.
Speaker 1 (21:04):
That is excellent.
Congratulations,congratulations.
That is excellent and I wishyou all the best with that raise
.
I think you've done incrediblywell and, yeah, and I wish you
all the best with that raise interms of your expansion, because
I think that's really exciting.
You've taken other people'scompanies across the continent
and now you get to take a shandyas well.
We can't have that conversationwithout talking about
(21:26):
regulation and I wonder whatit's been like in these markets.
You've mentioned South Africa,kenya and the likes.
What has it been like for youcoming back now as a shandy and
trying to navigate theregulatory environment on the
continent?
Speaker 2 (21:41):
So our approach has always been working with
regulators from the beginning,and so before we get into a
market, we basically engage theregulator directly.
I realized that it worked bestfrom the previous company I
worked for, where in thebeginning we consulted with
consulting firms audit firms tobasically give us an overview of
(22:02):
how it would work, how we wouldprepare our information and
work with lawyers, but Irealized the process took even a
lot longer because they werealso consulting with the
regulator.
So then I realized the best wayto do it is actually work with
the regulator from day one.
You get it from the horse'smouth.
They understand to you how itworks, what is is allowable,
what is not allowable, where youcan get all the resource
(22:24):
information you need, where therules of engagement are placed
and you can clearly see these,find these things on the central
bank's website and then how youconduct and how to do business
and what would be the keyrequirements regarding share
capital, the key positions youwould need to have, your
corporate governance structuresand all these other things that
you'd need to do.
So we basically worked with theregulators and being transparent
(22:47):
right from the beginning reallyhelps, because when they
understand what you're trying todo, even though it might be
different from the traditionalway of doing it.
It becomes easier for them toguide you because there have
been other players maybe thatcould have come before you.
So this is how we do it in allthe markets where we go in we
first work with the regulatorand then we understand the
market and we physically gothere in person to do our own
(23:10):
market assessment.
As much as I love consultancyand how it adds a lot of value,
but sometimes being there on theground seeing it yourself also
helps, and then the reports youget just validate what you've
been able to see on the ground.
Seeing it yourself also helps,and then the report you get just
validates what you've been ableto see on the market and give
you a different lens andperspective of a global overview
of what it essentially thenlooks like.
But it's important to behands-on.
Speaker 1 (23:32):
Yes, I agree.
So, apart from Zambia, whichother country are you operating
in today?
South Africa and Zimbabwe.
South Africa and Zimbabwe.
So what does your client basein those countries look like
compared to Zambia?
Speaker 2 (23:45):
So it's pretty much the same.
Our mission really is the same.
We are building a Pan-AfricanChallenger Bank for small
business owners and individualsin emerging markets, and so our
goal really is to help peoplewho are financially excluded,
who may not access these kindsof services easily because of
certain limitations that theymay face, and those are the
(24:06):
people we are really focusing on.
We are really trying to bridgethe $330 billion financing gap
that is faced across the Sahara.
Speaker 1 (24:15):
For our listeners who don't know what a challenger
bank is.
Can you just explain that fortheir benefit?
Speaker 2 (24:21):
Okay.
So a challenger bank is more ofa hybrid, more like a mix of
what a traditional bank lookslike and what a digital bank
looks like or a fintech.
So it's a combination of atech-enabled company which has
high tech, and then yourtraditional bank which is high
(24:41):
touch.
So we are more high tech, hightouch type of company where we
really focus on the customer andwe're in touch.
Those lines of communicationsare open and we're not just a a
digital place where you can'tphysically see us or you can't
really find us.
Speaker 1 (24:57):
So we're in between so what does competition look
like?
Who are your competitors on thecontinent?
Because we are building ahybrid model.
Speaker 2 (25:08):
we have more collaborators than competitors.
Okay, you find that?
On one end you have yourtraditional banks.
We don't see them ascompetitors.
We see them as enablers.
Reason why is because the bankhave their own segment that they
focus on.
We are focusing on thosecustomers that the bank cannot
reach, so we then can besupported by the bank to connect
(25:32):
the customers we want toconnect them to, and then the
bank also has access through us,because it's more like their
retail function to us to accessthe customers that are at the
base of the pyramid segment.
So that's where the enablementthen comes in with.
On the fintech side, for theneobank, the challenge is they
have all the tech, but the issueis they're not able to serve
(25:53):
the customers we serve.
So how we collaborate with themis leverage on the existing
tech that they've taken years toinvest and build on and they've
tested, but they then test anddeploy on our customer base.
So we see more collaboratorsrather than competitors.
But if I do sense peoplebuilding challenger banks, I
(26:14):
would say you have entities liketime bank in south africa, you
have entities like the bank innigeria, you have entities like
Branch in East Africa who arebuilding similar kind of models.
But the impact, thego-to-market strategy and
basically what they're trying toachieve is really the same and
I don't think it's a saturatedmarket where you can have one
(26:35):
player that can really dominatethis space.
Africa is so big, so vast.
Speaker 1 (26:39):
You have your francophone.
Speaker 2 (26:40):
You have your anglophone all these.
It's very difficult toencompass the whole of Africa.
Speaker 1 (26:47):
So who are your partners today?
I love the idea ofcollaboration and being a bridge
between traditional banking andfintechs, so who are the people
you partner with today todeliver this service?
Speaker 2 (26:59):
So we partner with the mobile network operators
through the mobile moneyplatform.
This is because this is youralternative banking method for
people who are in the informalsector, and so this is typically
what you see from your Airtelmoney Momo, that's with MTN,
your M-Tesa or your otherpayment providers in other
(27:20):
markets.
So those are the typical peoplewe partner with because they
have KYC data on people who haveaccess to their SIM cards, and
then they also have informationaround their average spend or
how they are transacting ontheir mobile money account, and
it becomes easy to partner withthem and provide our products on
their menus to access the samecustomers and we collaborate.
Speaker 1 (27:42):
That's great.
So in terms of challenges, thissounds so exciting and nothing
ventured, nothing gained andnothing comes easy, and I just
wondered what kinds ofchallenges you faced in building
this business over the.
You started just pre-COVID.
We went through the COVID yearsand you've grown and entered
new markets, but are there anysignificant challenges?
(28:05):
And if you've overcome some ofthem, it will be a great
learning for some of ourlisteners.
What kind of challenges haveyou faced in building in this
market?
Speaker 2 (28:13):
I think in the early stages, one of our biggest
challenges was building theright kind of team that could
work in a startup.
So the market I'm coming fromwe didn't have so many emerging
startups.
We only had establishedcorporate institutions.
So the mindset really aroundworking for a startup is very
(28:34):
different from a mindset ofwhere, when you're going into a
corporate institution, all thesestructures are in place, your
salaries are guaranteed, youdon't worry about if you're
getting paid, if you haven'traised money.
Your founder is looking formoney, raising money, pitching
here and there, the thing whereit's just your normal day-to-day
job description For what wewere doing and who believed in
the vision, believing insomething they really could not
(28:56):
see, but really believing in theperson who's driving this and
who is trying to visualizesomething for you that you can't
see.
But you believe that this iswhat we can achieve and this is
where we'll get.
It's really difficult to findpeople that can stay with you
for five years and trust thattheir career is safe and they're
not wasting their time.
(29:16):
So building the right kind ofteam, particularly when you're
bootstrapping and bootstrappingreally is a term to describe a
founder who's basicallyoperating their business with
their own resources and withoutexternal funding.
And so when we werebootstrapping, we were not
getting paid as founders and itwas a challenge to run around
(29:37):
and see where is money comingfrom here and there and the best
place we got revenue from andthe money we needed for the
business was from our customers.
But then building that teamthat could see that this is
where we are going and these arethe baby steps we need to take,
and then these are the leaps weneed to take when we need to
take them.
This is how we loosen up on ourappetite for risk and this is
(29:57):
how we tighten up when we seethings changing, because every
amount of money, every dollar,counts.
So you need to be veryconfident of how your movements
are working and people tounderstand how we track metrics
business metrics very closely.
So our biggest challenge wasgetting the right team in place
and secondly, it was aboutfunding for the travel, and
(30:19):
that's how we needed to pivotand look at alternative ways of
raising, and we did that throughpeer-to-peer lending, where we
raised more than we did withmeeting funding.
Speaker 1 (30:28):
So are there new markets you're considering and
maybe perhaps some new servicesyou're considering?
Speaker 2 (30:36):
Yes, we are looking at adding insurance products,
and not just health forhealthcare, but also for
protection of business againstfires, because those are the
common incidents that happen inmarket areas Fires where
someone's business is completelywiped out and they have to
start from scratch.
How do we protect people'sbusinesses, goods in transit for
cross border traders, and thenalso how?
(30:59):
do we then support smallbusinesses in being in
remittances.
How do we create an ecosystemwhere someone can have an
Ashanti app in South Africa, canhave an Ashanti app in East
Africa but can still move moneyIn Zimbabwe?
I'm an Uber driver in SouthAfrica but I'm from Zimbabwe.
How do I send money back home?
At very little, to no cost,because?
(31:19):
I'm using the same platform.
It should be free if it'swithin the same platform and how
do you create that kind ofinteroperability and make it
very affordable?
That's what we're looking at inthe future and also we are
really keen on getting into theFrancophone region in the future
.
Speaker 1 (31:35):
In terms of the future of fintech in Africa.
Is there anything that excitesyou about the future of fintech,
and are there things that maybeother entrepreneurs or
investors should pay attentionto?
Speaker 2 (31:49):
not to say this because I'm raising money, but
africa is the future.
That's right and basically themarket opportunity and the
growth opportunity is reallyhigh and this is why global
companies similarly to whatStripe did by acquiring Paystack
in Nigeria, and many otherglobal companies trying to
acquire businesses here inAfrica and investing in
businesses in Africa is becausethey see where the future is
(32:12):
going.
This is where you have yourlargest volume, and what I love
is the opportunity that nowinstitutions in collaboration
with banks, as well as theregulators across the continent,
are trying to create onecentralized financial switch
that will really increaseinteroperability and allow for
entities to now trade.
What we should have for thefuture is banking without
(32:36):
borders.
As long as I have an accountfrom here, I should be able to
transact with you.
It shouldn't be blocked becauseof borders and for me, as an
institution, to have to registermyself in each and every
country just to serve mycustomer, who's serving multiple
markets.
So the future really is bankingwithout borders, and we are
getting there through these newinfrastructures that are being
(32:59):
made.
Speaker 1 (32:59):
So I agree, the future is banking without
borders.
We started this conversationand I asked about why you
decided to set up your owncompany and do the work that you
do, and you spoke about impact.
I normally end the conversationby asking my guests to reflect
and to give advice.
So, in terms of reflecting andthinking about the impact that
(33:23):
you want to have, or you wantAshadi to have, on the continent
, what do you hope that Ashadiwould contribute to growth in
Africa?
Speaker 2 (33:31):
My dream is for everyone to be financially
included.
My dream is for everyone tohave an opportunity that they
can create their own financialfuture because they all have
access.
It should be a right and not aprivilege.
Where we are today, it's aprivilege to be able to go to
(33:53):
school.
It's a privilege, but it shouldbe a right.
So for me to be able to go toschool, I need access to
financial resources that enableme to go to school those
fundamental building blocks ofwhat children need.
It all comes down to one samething money.
For as long as the peopletaking care of you when you're
young do not have access to thatopportunity, your growth plan
(34:16):
is really limited as a child inwhere you go and how far you go.
But my dream is for everyone tohave the right to access to
finance for them to create theirown opportunities and build
their own wealth.
Everyone should have anopportunity to build wealth.
It shouldn't end at the dreamof getting a job, but the dream
(34:36):
is how do I create wealth forthe next generation and for the
fourth generation to come?
Everyone should believe thatthere's that possibility and
everyone should see thatpossibility can happen.
Speaker 1 (34:47):
And, based on all that you've done over the last
six or so years, is theresomething that you're most proud
of?
Speaker 2 (34:54):
I would say I'm most proud of the fact that we've
been able to help a lot of womenin business, men in business.
When we see customers who we'veserved move from having one
stand to having three stands,from having absolutely no fridge
in their home to buying afridge in their home, it may
(35:15):
look so small but those are bigwins for our customer.
And when they're proudlytelling you these stories, those
are successes for us, becausewe directly see the impact of
people being telling us now,today, oh, now I'm able to send
my goods across town or to one.
When we see someone proudly.
I was once proud when we weretaking an investor to see one
(35:37):
customer and they were so proudby showing them my stand was
this big and now I've extendedit like this I built this myself
.
Have you seen that car outside?
I bought this car myself.
This was a woman speaking soproudly of the things she
accomplished as a woman, butit's because of the opportunity
that was created for her thatshe was able to build her own
(36:00):
financial future herself.
We did not do that for her, shedid it herself.
All we did was create theopportunity.
So what I'm just proud of iscreating the opportunity for
others to also build forthemselves Fantastic, Fantastic
and Chilu.
Speaker 1 (36:14):
If you could give one piece of advice to other women
who are building businessesacross Africa, what advice would
that be?
Speaker 2 (36:22):
It would be never to give up on your dream and really
focus on the things that matterthe most.
There are so many things we'llface in our journeys that can
divert us from our core visionand focus, but when you focus on
the things that matter the most, you always stay grounded and
true to yourself and you end upalways doing the right thing and
(36:44):
you eventually get to where youneed to be.
Don't chase the wind, just staytrue to your path and to your
dream.
But number one never give up,never give up, never give up, no
matter what, never give up.
Speaker 1 (36:58):
Thank you so much.
So how can people learn moreabout Eshadi and how can they
support the work that you'redoing?
Speaker 2 (37:06):
I would encourage people to look us up through our
website at wwweshadicom andalso reach out to the contact
information that is provided.
We're happy to listen to anyoneand share more of our story,
what we are doing and ourjourney ahead, and how we can
collaborate and partner withother ecosystem enablers that
(37:27):
also are focusing on the missionand to champion financial
inclusion across Africa.
Speaker 1 (37:33):
Thank you so much.
This has been such a greatconversation.
Thank you.
Speaker 2 (37:38):
Thank you, thank you so much.
Thank you very much for havingme.
Speaker 1 (37:41):
Thank you so much for listening.
If you're not alreadysubscribed, please do so on
Apple, spotify or wherever youget your podcasts, and don't
forget to leave us a review sowe know how we're doing.
I'm Akego Okoye and you havebeen listening to African
Business Stories.
With more female entrepreneurs than any other
region in the world.
Women are at the heart ofAfrica's transformation.
Welcome to African BusinessStories, the show that amplifies
the voices of femaleentrepreneurs shaping Africa's
business landscape.
I'm your host, ekego Koye.
Here we explore bold ideas,strategies for scaling and the
(00:25):
realities of building businessesthat drive economic development
.
These stories will provideinsights into Africa's business
landscape, practical tools forgrowth and the inspiration to
navigate your ownentrepreneurial journey.
Be sure to subscribe, rate andshare Neuro journey.
(00:51):
Be sure to subscribe, rate andshare On the show.
Today I chat with ChilufiaMutale-Muila, co-founder and
chief visionary officer atEchadi, a pan-African challenger
bank, transforming financialaccess for small businesses and
female entrepreneurs.
With a background inmicrofinance and fintech, chilu
has spent over a decade workingto bridge the financial
(01:11):
inclusion gap across Africa.
We talk about her journey fromZambia to leading fintech
expansion across multipleAfrican markets, the challenges
of navigating regulation,raising capital, and how Ashadi
is redefining financial servicesfor underserved communities.
It's a conversation aboutinnovation and the future of
(01:33):
banking in Africa.
Let's get into it.
Hi, chilu, welcome to AfricanBusiness Stories.
Thank you so much for having me.
I'm happy to be here.
I normally like to start fromthe very beginning.
We like to say let's start fromwhere it all began.
And I know that you're fromZambia, which is in Southern
Africa, and I wonder if youwould share maybe some
(01:56):
interesting facts that maybe ourlisteners don't know about
Zambia.
I've read quite a few and it'squite interesting, so it'd be
good to hear from you someinteresting facts about Zambia.
Speaker 2 (02:06):
I've read quite a few and it's quite interesting.
So it'd be good to hear fromyou some interesting facts about
Zambia.
Zambia is known for its warmhospitality.
It's noted to be one of thefriendliest nations in the world
.
It's a beautiful and diversecountry.
We are home to the VictoriaFalls, one of the seven natural
wonders of the world.
Locally, we call it theMothiotunia, which means the
smoke that thunders, and it'salso one of the world.
Locally we call it theMosiotumia, which means the
smoke that thunders, and it'salso one of the most peaceful
(02:27):
nations across Africa.
Speaker 1 (02:29):
So, in terms of growing up, I know you were born
and raised in Zambia.
Are there any childhoodmemories that have stayed with
you over the years?
Speaker 2 (02:37):
One of my fondest memories was with my parents.
Both my parents are deceased.
My mother left when I was onlybarely seven and I was raised by
single parents, so my fondestmemories were with my mother and
dad, and each time we'd receivevisitors, especially our
grandparents, our parents, wouldput us all in the middle and
then we'd start dancing andthey'd be clapping for us.
(02:57):
So it was always a competitionfor us kids who would dance the
most, the best, and I alwaysloved the fact that they always
really cheered for me and theywere so happy with how I was
dancing.
I don't remember how I wasdancing, but I was always giving
money.
So that's the only time youever got money when visitors
came and then you dance and thenthey'll give you, give you
things.
So those are the fondestmemories of how, as a community,
(03:18):
as a family, we come togetherwith children.
It's something that I don't seeso often because we're all
working, we're so busy, we'reall living our own lives and we
get to see each other whenthere's a funeral or there's a
gathering, there's a wedding andthings like that, but not those
associations where grandparents, grandchildren, the parents all
together.
It's a different lifestyle thatwe live in today, I agree.
Speaker 1 (03:41):
So just moving on to university, I know that you
studied natural resourcemanagement, is what I read.
Yes, how did you come to studythat?
Your career is far from that,but we'll come to talk about
that.
But how did you come to studythat?
Speaker 2 (04:07):
actually wanted to do computer science and but I
didn't make the cut and so Iwent to the second choice and
then in the second choice option, basically there wasn't any
opportunity for me to sit intothat class because this all the
seats were taken up by peoplethat have put it as the first
choice, and so I ended up in aclass that was basically
studying physics and, oh mygoodness, it was so off for me
that I flunked.
I was put on an extra programwhere I had to go home, sit out
(04:31):
a semester and then come back,and that would mean me losing my
bursary.
I was sponsored by thegovernment.
I was on a governmentsponsorship and and so my
lecture basically one of mylectures in physics said you did
so well in my course.
I don't see why you have to gohome and then lose your bursary.
How are you going to come back?
How will your father pay forthis?
And that's how he pleaded withthe dean of one of the other
(04:53):
schools in natural resources tofit me and squeeze me in.
And that's how I ended up doingnatural resource management.
I have no idea about what Istudied, because I've never
applied even any single part ofit in my life since I graduated.
Speaker 1 (05:11):
Yeah, in 2009.
So then you finished yourdegree.
And then what?
Speaker 2 (05:17):
How did you end up in microfinance, and so
microfinance, I had stayed homefor one year after graduating.
I looked for multiple jobs,applied for many jobs, but the
first interview that I got thatjob and it was in a microfinance
company and I applied for a jobas an intern.
And that's how I really got tolove what I really do.
The beauty about the internshipI was made to go in different
(05:40):
markets, different parts of townto understand from people who
were doing business what theirpain points were, what problems
they had and how could afinancial institution help solve
those problems.
So we're carrying out aresearch to see how we can
provide impact and providefinancial support to small
business owners and ininteracting with people.
(06:01):
That's where the passion reallyderives from, because the
microfinance institution waspreviously an NGO and their
mission and vision was clearlyto alleviate poverty, but to
access to easy and affordablefinancial services so that they
can basically socially improvethe lifestyle and the
livelihoods of people.
Because these are the people whoare at the base of the pyramid
(06:23):
segment, the mass market peoplewho were not really literate,
they couldn't sign on a document, they had no savings
opportunities, they had no bankaccounts, but these are people
who were trading and these arepeople who had homes and
children, and most of theirchildren were trading with them
because they could not afford totake them to school.
And that's common in mostmarkets, not just in Zambia.
(06:44):
And so that's common in mostmarkets, not just in Zambia.
And so that's where really thepassion derives from.
It is just through those hightouch interactions with people
and seeing the real impactbefore my eyes.
That's where it all came from.
Speaker 1 (06:57):
I had no academic micro finance background or
financial services, but that'swhere it all started yeah, the
learning is in the doing, isn'tit?
It really is in the doing, so.
So how long did you spend inmicrofinance?
Speaker 2 (07:10):
so I was in microfinance for six years uh
before evolving uh into afintech, and this fintech was
coming from eastern europe.
They were trying to test theiroperations in Africa and because
data is primarily fragmented inAfrica, you need to use
multiple sources of getting datafor you to then basically
(07:31):
provide a digital loan, forexample, to a customer.
It was very new in this market,so they headhunted me and gave
me a CEO role to basically setup operations for them in
Southern Africa.
I set up operations for theentities in Zambia, zimbabwe,
malawi, botswana, namibia and inZambia.
Basically, even getting alicense was really hard because
(07:52):
we had to explain to theregulator how we're going to
operate, differently from atraditional microfinance
institution.
We didn't have fintech back inthe day, and so just to get
regulatory buy-in as well asunderstand what kind of licenses
would be because our businessmodel is different from your
traditional microfinance model.
(08:13):
This is a digital platform,technology-driven.
How are you scoring customers?
How is the customer approvingand acknowledging the terms and
conditions?
How are they understanding?
How are you providing financialliteracy to this customer?
How are you managing to makemoney and avoid the risk of
default, especially that you'renot collecting physical assets
like the way a typicalmicrofinance would just
(08:35):
transform and evolve into that?
Speaker 1 (08:39):
So how did you personally make the transition
from traditional microfinancebanking to fintech?
Speaker 2 (08:45):
Honestly, it's the willingness and the passion.
Once you have that keeninterest and you see how you can
make meaningful impact, itbecomes easy to learn,
transition and then know how todo it.
So for me, I saw how successfulmicrofinance models work for
small business traders, informalthe informal sector,
(09:05):
particularly women and the youthin business.
But what I saw that was missingwas the efficiency and the time
.
So when people need workingcapital solutions, they need the
money.
Now I cannot come to you andask for funds and then it takes
me three to one month or twomonths for me to access those
funds, and then it shouldn'ttake me six months for me to
trade with you, for you to beable to give me a loan, because
(09:27):
you want trading history with meif I'm depositing with you.
So what people need is asolution that solves their pain
point at that time, and that'show you can have buy-in and
trust from the customer.
So, with the consumer lendingcompany, what they brought was
efficiency and speed, and Irealized that those were the
common problems and thebottlenecks we had as a
(09:48):
microfinance institution.
So it was easy to assimilatetechnology as an enabler to then
provide very quick andaccessible financial solutions.
And because technology is anenabler, I realized that it was
very cost effective.
Because you do need so manypeople to process application.
It didn't need to take so muchtime and so many processes
around.
(10:08):
The tech could be end-to-endautomated.
With scalability, someone caninstantly get financing, just
like that that's interesting.
Speaker 1 (10:17):
So you took this company, they took you, they
brought you in as ceo and youtook this company across
southern africa.
So just walk us through maybetwo examples of two, two CEO and
you took this company acrossSouthern Africa.
So just walk us through maybetwo examples of two countries
that you took this company intoand the differences you saw in
market entry.
Speaker 2 (10:32):
So you find that for markets like Botswana, the
regulators are different.
So for a financial institutionor a FinTech, basically there's
a different unit, separate fromthe reserve bank or central bank
, that manages, and so you find,like in other markets, it's way
more developed and certainprocesses can be done online and
(10:52):
it's very straightforward andwithin a specific time frame you
get your feedback, whether it'san approval or it's not an
approval.
In other markets, like Zambia,it took a rather longer process
and also because we were here.
Basically we had the patience tohave the back and forth
discussions and understandingand providing that clarity.
But for other markets that aremore developed, where fintechs
(11:16):
are already existing, theregulator is very confident of
how they operate.
They've created the frameworksaround it that govern it and
they bring it.
It becomes much easier toprovide you quick feedback and
the licensing and the governanceoperates.
They've created the frameworksaround it that govern it and
they bring sensitive.
It becomes much easier toprovide you quick feedback and
the licensing and the governancearound it because those
structures already evolved anddeveloped fantastic.
Speaker 1 (11:34):
So how long were you with the fintech?
Speaker 2 (11:36):
for I was with them for about two years so in total
I spent about nine years in thecorporate sector before taking a
leap of faith as anentrepreneur A real leap of
faith.
Speaker 1 (11:48):
I mean an unemployed person.
I know right, I know.
So what made you decide to makethat leap of faith?
Speaker 2 (11:57):
I really struggled around impact when it came to
the technology-driven business,because it really catered to
people that were alreadyfinancially included, because
there was already data that wasavailable to help the
institution leverage thatexisting information that is
verifiable to then provideinstant financing.
And then I missed out on theopportunity of where, with the
(12:20):
traditional, microfinance,institutions were serving small
business owners who didn't haveformal financial services, that
kind of access and financialhistory, credit history.
Even with the credit referencebureaus, there's zero
information about these kinds ofcustomers, and this is because
they borrow from your loansharks, your informal traders,
with high, exorbitant interestrates.
(12:40):
There's no financial recordabout these transactions because
they're mainly cash driven.
And so what I then decided waswhat if we can have a mix of
both, can't we have the best ofboth worlds and then serve the
customers that really need thesupport, who don't really have
the luxury of choice of pickingthree to four banks that they
can go to and shop for pricing,but they basically need a
(13:04):
financing partner that can growwith them in their business, and
we felt Ishandi would be thatpartner by getting the best of
both worlds.
Both institutions wereexceptionally good.
One was highly driven by tech,but we needed to use that tech
for the people that needed thefinancing the most.
And that's the math Right.
Speaker 1 (13:23):
Yeah, so when you launched this business, it was
called Premier Credit.
Speaker 2 (13:28):
Yes.
Speaker 1 (13:29):
And I've seen that there's been a rebrand to
Eshandi.
So what inspired the namechange and what does Eshandi
mean?
We?
Speaker 2 (13:36):
started off back in 2019 as Premier Credit and we're
providing many loans to smallbusiness owners in business, and
as we then startedunderstanding our customers
better and trying to solve thecustomers problems, their pain
points in their business journey, we realized that it's not only
a loan that they required, andparticularly for us as an
(13:57):
institution to build up ahistory of their financial
records.
We needed the customers totransact and we needed to
digitize their cash.
So how do we drive a customerfrom a cash-driven society to a
cashless society where they cantrust a financial institution,
they can pay their suppliers,they can make their purchases
(14:17):
via mobile money or their wallet, and then that kind of
financial linkage and that datacan be used to score a customer
and then understand theircapacity to pay, without even
the need for them to providework goods from their home, from
their shop or a house orvehicle and for most people who
don't have, they basically won'tbe able to access.
(14:38):
And so we then decided to thenadd additional financial
products so that we provide aholistic one-stop shop where a
customer can access a loan, cansave, can invest, can send money
, can pay and can get aninsurance product like the Horsi
Cash Cover.
And that is what now Ishandimeans, because we were creating
(15:02):
an opportunity for a customer toattain financial freedom by
becoming formally financiallyincluded and introduced into the
banking realm.
So we then put the bank, whichis our wallet, into the
customer's hands.
They can easily access it, evenwith a feature phone.
They can easily access it fromwhere they are, without leaving
their place of business.
(15:23):
They can transact and digitizetheir financial records on our
platform and be able to thenbecome financially included,
because we will then do theheavy lifting and put all that
information and update thatinformation even in the credit
reference bureaus, so that itbecomes easier for even other
financial institutions toprovide other services to them.
(15:44):
So Ishandi really means thepower is yours, in your hands,
and you have the power to attainyour own financial freedom and
build your own financial future.
Ishandi means mine, so thepower is with you and not with
the bank, but with you, theconsumer.
Speaker 1 (15:59):
That's fantastic.
That's a real fantastic storyand service that you're
providing.
What does your client base looklike today?
Speaker 2 (16:07):
So most of our clients are in the informal
sector.
These are previouslydisadvantaged income groups from
underserved communities,marginalized communities.
These are customers who are inthe informal sector that do not
have registered businesses butare small-scale traders.
Some of them are cross-bordertraders.
Some of them are who you'd callmarketeers, who are doing
(16:30):
general trade in the markets andhave small stores where they
are basically operating as wellas they also cater to the larger
extent SMEs who have formallyregistered their businesses and
have a few employees in theirbusinesses but are unable to
access the full extent oftraditional bank services.
Speaker 1 (16:47):
You have a very broad customer base.
What does repayment look likefrom these different groups of
customers?
Speaker 2 (16:55):
So you will find that repayment from customers who
have been historicallydisadvantaged is way better than
people who have access toformal financial services from
other financial institutions.
The reason being is you findthat when you're not really
spoiled for choice and when youfind a good product or service
that works for you, thelikelihood of you wanting to
(17:18):
build a good workingrelationship with them because
you can easily access futurefinancing from them when you
need it.
You want to build a good record, and so those kinds of
customers who always pay on timeand most of them would prefer
to make payments on a dailybasis because they are generally
trading, rather than payingonce a month because they'll say
I'll forget on that day, maybemy child is sick or I have a
(17:40):
funeral or have a problem, Imight forget.
They don't have diary recordedon the phone where something
happened, where they arereminded.
They would rather say I'm goingto save X amount every day.
How much do I need to save upevery day to accumulate to a
monthly installment?
So those are your best pairsbecause for them, they're
looking at the financial partner.
They started calling us a bankback in 2019, when we're not
(18:00):
even a bank.
Started calling us a bank backin 2019, when we're not even a
bank.
They called us a bank becausethey saw us as one-stop solution
, when we were only providing aloan product and all they see is
an institution that comes tothem.
We bring the financial serviceto them and we're solving their
problems with them, and weunderstand them.
I come from that same kind ofbackground so I understand, and
(18:22):
the employees we have also comefrom the same background.
My father also was a customerfrom the first company that
hired me, so he benefited fromthose services indirectly.
I benefited as a child from thathousehold because that small
business owners are able to taketheir kids to school if their
businesses are thriving.
If their businesses are notthriving, the economic growth
(18:46):
becomes stunted for a nation,especially in growing economies.
And even when it comes tohealthcare and food, you face
all these challenges because,trust you me, a small business
owner has to cover hospitalbills from the money they make
from that same business, has tocover food, rent, a roof over
their head from that same smallbusiness.
So imagine if it caught fire.
(19:06):
They didn't have an insurancefor that.
Imagine if they were safe.
Imagine if they didn't haveworking capital to grow Everyone
.
There's a whole chain, a rippleeffect that gets affected just
because of one small business,and I'm a product of a
successful story like that.
Speaker 1 (19:22):
So how do you raise the money to be able to at least
offer these loans and all theother products you offer to
people?
Speaker 2 (19:30):
So raising funds has been a challenge for us, one of
the constraints we faced.
We were, fortunate enough,after we launched our operations
in 2019, after 18 months oftrading, we were able to raise a
stage investor from an earlystage investor.
They are a gender-line focusedfund and they gave us $650,000
in 2020, and they gave usfollow-on investment of about
(19:52):
$1.5 million and in total, theygave us close to $3 million in
funding.
And from that time back in 2020, we only further raised an
additional $2.5 million from animpact lender, a Swiss fund.
And then we then innovated bylaunching a peer-to-peer lending
platform to the regulatorysandbox of the Securities and
(20:14):
Exchange Commission.
Primarily, the sandbox was tohelp us provide working capital
to small business owners, butusing funds from the local
market rather than raising moreequity or debt from venture debt
from VC.
So we launched this platformthat could easily allow us to
connect people who had money andwanted to earn some passive
(20:35):
income to people who were inneed of financing, and we
connected them to our platform.
We had raised over $6 millionthrough that platform and so in
total, we raised about $11.8million to date.
We are currently raising aseries of rounds of $15 million.
We are looking for equity aswell as debt and looking for
partners to join us as we expandinto other markets in South
(20:59):
Africa, kenya, zimbabwe expandinto other markets in South
Africa, kenya, zimbabwe andwhere we are in Zambia.
Speaker 1 (21:04):
That is excellent.
Congratulations,congratulations.
That is excellent and I wishyou all the best with that raise
.
I think you've done incrediblywell and, yeah, and I wish you
all the best with that raise interms of your expansion, because
I think that's really exciting.
You've taken other people'scompanies across the continent
and now you get to take a shandyas well.
We can't have that conversationwithout talking about
(21:26):
regulation and I wonder whatit's been like in these markets.
You've mentioned South Africa,kenya and the likes.
What has it been like for youcoming back now as a shandy and
trying to navigate theregulatory environment on the
continent?
Speaker 2 (21:41):
So our approach has always been working with
regulators from the beginning,and so before we get into a
market, we basically engage theregulator directly.
I realized that it worked bestfrom the previous company I
worked for, where in thebeginning we consulted with
consulting firms audit firms tobasically give us an overview of
(22:02):
how it would work, how we wouldprepare our information and
work with lawyers, but Irealized the process took even a
lot longer because they werealso consulting with the
regulator.
So then I realized the best wayto do it is actually work with
the regulator from day one.
You get it from the horse'smouth.
They understand to you how itworks, what is is allowable,
what is not allowable, where youcan get all the resource
(22:24):
information you need, where therules of engagement are placed
and you can clearly see these,find these things on the central
bank's website and then how youconduct and how to do business
and what would be the keyrequirements regarding share
capital, the key positions youwould need to have, your
corporate governance structuresand all these other things that
you'd need to do.
So we basically worked with theregulators and being transparent
(22:47):
right from the beginning reallyhelps, because when they
understand what you're trying todo, even though it might be
different from the traditionalway of doing it.
It becomes easier for them toguide you because there have
been other players maybe thatcould have come before you.
So this is how we do it in allthe markets where we go in we
first work with the regulatorand then we understand the
market and we physically gothere in person to do our own
(23:10):
market assessment.
As much as I love consultancyand how it adds a lot of value,
but sometimes being there on theground seeing it yourself also
helps, and then the reports youget just validate what you've
been able to see on the ground.
Seeing it yourself also helps,and then the report you get just
validates what you've been ableto see on the market and give
you a different lens andperspective of a global overview
of what it essentially thenlooks like.
But it's important to behands-on.
Speaker 1 (23:32):
Yes, I agree.
So, apart from Zambia, whichother country are you operating
in today?
South Africa and Zimbabwe.
South Africa and Zimbabwe.
So what does your client basein those countries look like
compared to Zambia?
Speaker 2 (23:45):
So it's pretty much the same.
Our mission really is the same.
We are building a Pan-AfricanChallenger Bank for small
business owners and individualsin emerging markets, and so our
goal really is to help peoplewho are financially excluded,
who may not access these kindsof services easily because of
certain limitations that theymay face, and those are the
(24:06):
people we are really focusing on.
We are really trying to bridgethe $330 billion financing gap
that is faced across the Sahara.
Speaker 1 (24:15):
For our listeners who don't know what a challenger
bank is.
Can you just explain that fortheir benefit?
Speaker 2 (24:21):
Okay.
So a challenger bank is more ofa hybrid, more like a mix of
what a traditional bank lookslike and what a digital bank
looks like or a fintech.
So it's a combination of atech-enabled company which has
high tech, and then yourtraditional bank which is high
(24:41):
touch.
So we are more high tech, hightouch type of company where we
really focus on the customer andwe're in touch.
Those lines of communicationsare open and we're not just a a
digital place where you can'tphysically see us or you can't
really find us.
Speaker 1 (24:57):
So we're in between so what does competition look
like?
Who are your competitors on thecontinent?
Because we are building ahybrid model.
Speaker 2 (25:08):
we have more collaborators than competitors.
Okay, you find that?
On one end you have yourtraditional banks.
We don't see them ascompetitors.
We see them as enablers.
Reason why is because the bankhave their own segment that they
focus on.
We are focusing on thosecustomers that the bank cannot
reach, so we then can besupported by the bank to connect
(25:32):
the customers we want toconnect them to, and then the
bank also has access through us,because it's more like their
retail function to us to accessthe customers that are at the
base of the pyramid segment.
So that's where the enablementthen comes in with.
On the fintech side, for theneobank, the challenge is they
have all the tech, but the issueis they're not able to serve
(25:53):
the customers we serve.
So how we collaborate with themis leverage on the existing
tech that they've taken years toinvest and build on and they've
tested, but they then test anddeploy on our customer base.
So we see more collaboratorsrather than competitors.
But if I do sense peoplebuilding challenger banks, I
(26:14):
would say you have entities liketime bank in south africa, you
have entities like the bank innigeria, you have entities like
Branch in East Africa who arebuilding similar kind of models.
But the impact, thego-to-market strategy and
basically what they're trying toachieve is really the same and
I don't think it's a saturatedmarket where you can have one
(26:35):
player that can really dominatethis space.
Africa is so big, so vast.
Speaker 1 (26:39):
You have your francophone.
Speaker 2 (26:40):
You have your anglophone all these.
It's very difficult toencompass the whole of Africa.
Speaker 1 (26:47):
So who are your partners today?
I love the idea ofcollaboration and being a bridge
between traditional banking andfintechs, so who are the people
you partner with today todeliver this service?
Speaker 2 (26:59):
So we partner with the mobile network operators
through the mobile moneyplatform.
This is because this is youralternative banking method for
people who are in the informalsector, and so this is typically
what you see from your Airtelmoney Momo, that's with MTN,
your M-Tesa or your otherpayment providers in other
(27:20):
markets.
So those are the typical peoplewe partner with because they
have KYC data on people who haveaccess to their SIM cards, and
then they also have informationaround their average spend or
how they are transacting ontheir mobile money account, and
it becomes easy to partner withthem and provide our products on
their menus to access the samecustomers and we collaborate.
Speaker 1 (27:42):
That's great.
So in terms of challenges, thissounds so exciting and nothing
ventured, nothing gained andnothing comes easy, and I just
wondered what kinds ofchallenges you faced in building
this business over the.
You started just pre-COVID.
We went through the COVID yearsand you've grown and entered
new markets, but are there anysignificant challenges?
(28:05):
And if you've overcome some ofthem, it will be a great
learning for some of ourlisteners.
What kind of challenges haveyou faced in building in this
market?
Speaker 2 (28:13):
I think in the early stages, one of our biggest
challenges was building theright kind of team that could
work in a startup.
So the market I'm coming fromwe didn't have so many emerging
startups.
We only had establishedcorporate institutions.
So the mindset really aroundworking for a startup is very
(28:34):
different from a mindset ofwhere, when you're going into a
corporate institution, all thesestructures are in place, your
salaries are guaranteed, youdon't worry about if you're
getting paid, if you haven'traised money.
Your founder is looking formoney, raising money, pitching
here and there, the thing whereit's just your normal day-to-day
job description For what wewere doing and who believed in
the vision, believing insomething they really could not
(28:56):
see, but really believing in theperson who's driving this and
who is trying to visualizesomething for you that you can't
see.
But you believe that this iswhat we can achieve and this is
where we'll get.
It's really difficult to findpeople that can stay with you
for five years and trust thattheir career is safe and they're
not wasting their time.
(29:16):
So building the right kind ofteam, particularly when you're
bootstrapping and bootstrappingreally is a term to describe a
founder who's basicallyoperating their business with
their own resources and withoutexternal funding.
And so when we werebootstrapping, we were not
getting paid as founders and itwas a challenge to run around
(29:37):
and see where is money comingfrom here and there and the best
place we got revenue from andthe money we needed for the
business was from our customers.
But then building that teamthat could see that this is
where we are going and these arethe baby steps we need to take,
and then these are the leaps weneed to take when we need to
take them.
This is how we loosen up on ourappetite for risk and this is
(29:57):
how we tighten up when we seethings changing, because every
amount of money, every dollar,counts.
So you need to be veryconfident of how your movements
are working and people tounderstand how we track metrics
business metrics very closely.
So our biggest challenge wasgetting the right team in place
and secondly, it was aboutfunding for the travel, and
(30:19):
that's how we needed to pivotand look at alternative ways of
raising, and we did that throughpeer-to-peer lending, where we
raised more than we did withmeeting funding.
Speaker 1 (30:28):
So are there new markets you're considering and
maybe perhaps some new servicesyou're considering?
Speaker 2 (30:36):
Yes, we are looking at adding insurance products,
and not just health forhealthcare, but also for
protection of business againstfires, because those are the
common incidents that happen inmarket areas Fires where
someone's business is completelywiped out and they have to
start from scratch.
How do we protect people'sbusinesses, goods in transit for
cross border traders, and thenalso how?
(30:59):
do we then support smallbusinesses in being in
remittances.
How do we create an ecosystemwhere someone can have an
Ashanti app in South Africa, canhave an Ashanti app in East
Africa but can still move moneyIn Zimbabwe?
I'm an Uber driver in SouthAfrica but I'm from Zimbabwe.
How do I send money back home?
At very little, to no cost,because?
(31:19):
I'm using the same platform.
It should be free if it'swithin the same platform and how
do you create that kind ofinteroperability and make it
very affordable?
That's what we're looking at inthe future and also we are
really keen on getting into theFrancophone region in the future
.
Speaker 1 (31:35):
In terms of the future of fintech in Africa.
Is there anything that excitesyou about the future of fintech,
and are there things that maybeother entrepreneurs or
investors should pay attentionto?
Speaker 2 (31:49):
not to say this because I'm raising money, but
africa is the future.
That's right and basically themarket opportunity and the
growth opportunity is reallyhigh and this is why global
companies similarly to whatStripe did by acquiring Paystack
in Nigeria, and many otherglobal companies trying to
acquire businesses here inAfrica and investing in
businesses in Africa is becausethey see where the future is
(32:12):
going.
This is where you have yourlargest volume, and what I love
is the opportunity that nowinstitutions in collaboration
with banks, as well as theregulators across the continent,
are trying to create onecentralized financial switch
that will really increaseinteroperability and allow for
entities to now trade.
What we should have for thefuture is banking without
(32:36):
borders.
As long as I have an accountfrom here, I should be able to
transact with you.
It shouldn't be blocked becauseof borders and for me, as an
institution, to have to registermyself in each and every
country just to serve mycustomer, who's serving multiple
markets.
So the future really is bankingwithout borders, and we are
getting there through these newinfrastructures that are being
(32:59):
made.
Speaker 1 (32:59):
So I agree, the future is banking without
borders.
We started this conversationand I asked about why you
decided to set up your owncompany and do the work that you
do, and you spoke about impact.
I normally end the conversationby asking my guests to reflect
and to give advice.
So, in terms of reflecting andthinking about the impact that
(33:23):
you want to have, or you wantAshadi to have, on the continent
, what do you hope that Ashadiwould contribute to growth in
Africa?
Speaker 2 (33:31):
My dream is for everyone to be financially
included.
My dream is for everyone tohave an opportunity that they
can create their own financialfuture because they all have
access.
It should be a right and not aprivilege.
Where we are today, it's aprivilege to be able to go to
(33:53):
school.
It's a privilege, but it shouldbe a right.
So for me to be able to go toschool, I need access to
financial resources that enableme to go to school those
fundamental building blocks ofwhat children need.
It all comes down to one samething money.
For as long as the peopletaking care of you when you're
young do not have access to thatopportunity, your growth plan
(34:16):
is really limited as a child inwhere you go and how far you go.
But my dream is for everyone tohave the right to access to
finance for them to create theirown opportunities and build
their own wealth.
Everyone should have anopportunity to build wealth.
It shouldn't end at the dreamof getting a job, but the dream
(34:36):
is how do I create wealth forthe next generation and for the
fourth generation to come?
Everyone should believe thatthere's that possibility and
everyone should see thatpossibility can happen.
Speaker 1 (34:47):
And, based on all that you've done over the last
six or so years, is theresomething that you're most proud
of?
Speaker 2 (34:54):
I would say I'm most proud of the fact that we've
been able to help a lot of womenin business, men in business.
When we see customers who we'veserved move from having one
stand to having three stands,from having absolutely no fridge
in their home to buying afridge in their home, it may
(35:15):
look so small but those are bigwins for our customer.
And when they're proudlytelling you these stories, those
are successes for us, becausewe directly see the impact of
people being telling us now,today, oh, now I'm able to send
my goods across town or to one.
When we see someone proudly.
I was once proud when we weretaking an investor to see one
(35:37):
customer and they were so proudby showing them my stand was
this big and now I've extendedit like this I built this myself
.
Have you seen that car outside?
I bought this car myself.
This was a woman speaking soproudly of the things she
accomplished as a woman, butit's because of the opportunity
that was created for her thatshe was able to build her own
(36:00):
financial future herself.
We did not do that for her, shedid it herself.
All we did was create theopportunity.
So what I'm just proud of iscreating the opportunity for
others to also build forthemselves Fantastic, Fantastic
and Chilu.
Speaker 1 (36:14):
If you could give one piece of advice to other women
who are building businessesacross Africa, what advice would
that be?
Speaker 2 (36:22):
It would be never to give up on your dream and really
focus on the things that matterthe most.
There are so many things we'llface in our journeys that can
divert us from our core visionand focus, but when you focus on
the things that matter the most, you always stay grounded and
true to yourself and you end upalways doing the right thing and
(36:44):
you eventually get to where youneed to be.
Don't chase the wind, just staytrue to your path and to your
dream.
But number one never give up,never give up, never give up, no
matter what, never give up.
Speaker 1 (36:58):
Thank you so much.
So how can people learn moreabout Eshadi and how can they
support the work that you'redoing?
Speaker 2 (37:06):
I would encourage people to look us up through our
website at wwweshadicom andalso reach out to the contact
information that is provided.
We're happy to listen to anyoneand share more of our story,
what we are doing and ourjourney ahead, and how we can
collaborate and partner withother ecosystem enablers that
(37:27):
also are focusing on the missionand to champion financial
inclusion across Africa.
Speaker 1 (37:33):
Thank you so much.
This has been such a greatconversation.
Thank you.
Speaker 2 (37:38):
Thank you, thank you so much.
Thank you very much for havingme.
Speaker 1 (37:41):
Thank you so much for listening.
If you're not alreadysubscribed, please do so on
Apple, spotify or wherever youget your podcasts, and don't
forget to leave us a review sowe know how we're doing.
I'm Akego Okoye and you havebeen listening to African
Business Stories.
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