Mines, a Nigerian fintech startup revolutionizing the credit system in emerging economies closed a Series A funding round of $13 million earlier this month. The round of funding, which was led by The Rise Fund, a global fund managed by TPG Growth, will enable Mines to intensify talent acquisition to supplement the company’s technical needs, continuous growth in Africa, and expansion to countries in South America and South-East Asia.
In an interview with Ventures Africa, Mines Vice-President Commercial & Managing Director Nigeria, Adia Sowho said the company is in discussions with several partners across Africa, in South America and South-East Asia, “We are growing the business in a number of areas which need support, particularly on the technical side” she said.
Mines was founded in 2014 by a group of computer scientists working on an artificial intelligence research project at Stanford University. Having spent some years growing up in developing countries, they understand fully the challenges people living in such countries face when trying to get a loan. Solving this problem ignited their interest to create this digital credit platform.
With offices in San Mateo, California, and Lagos, Mines provides a Credit-as-a-Service digital platform that enables institutions in emerging markets to offer credit products to their customers. The company views itself as a global technology company with an ability to adapt their thinking to the functionality of any local business and consumer landscape in order to create a product that works well.
The name Mines is easy to understand when you consider the way the company operates. Through a process of mining a great volume of data such as bank records, phone records, payment of goods and services in real-time, it assesses credit risks in markets with no credit assessment and rating institution. It integrates its risk assessment model with identity, origination, payments, loan lifecycle management, and customer service to provide an integrated service.
The services Mines offers have been well-received by customers for being fast and simple, catering to customers at all levels of the income pyramid. All a customer needs is a normal feature phone – not necessarily a smartphone and no data plan is needed. This offers customers a private and safe way to get an instant loan within minutes to take care of emergency bills, grow their businesses, or simply offer financial support when in need.
“Our portfolio performance is quite good. This is one of the reasons we were able to convince investors like TPG and Velocity to invest in us. More importantly, the performance continues to improve as our algorithms learn how customers behave” Adia Sowho said.
Before rounding up this series of funding, Mines tested its services in Nigeria and reports that about one million customers have used their platform. This reception has driven their desire to expand into similar emerging economies. According to the Chief Executive Officer at Mines, Ekechi Nwokah, adults without access to credit exceed 3 billion. The vision of the company is to grant credit access to that number in the next 10 years. The company believes the best way that vision can be a reality is by partnering with banks, retailers and mobile operators to power digital credit products specially made to fit their markets.
How the government can help bank Nigeria’s unbanked
During the interview with Ventures Africa, Adia Sowho suggested some ways the government could make it easier to do business in Nigeria.
“We think the government is doing a great job in enabling national digital infrastructure, particularly with identity solutions like SIM registration and Bank Verification Number (BVN). We think more support for BVN and SIM registration would accelerate access for the underbanked. We would also encourage more
data sharing with financial institutions and more license enforcement – the presence of unlicensed or improperly licensed lenders put customers at risk,” she said.
Also, part of this round of funding are Velocity Capital, Western Technology Investments, First Ally Capital, X/Seed Capital, NYCA Partners, Persistent Capital, Singularity Investments, Trans Sahara Investments, and the Bank of Industry, Nigeria. Yemi Lalude from TPG Growth (founder of The Rise Fund) and Willem Willemstein from Velocity Capital have joined Mines’ board of directors as a part of the Series A funding agreements.
Living in a country with a high probability of financial constraints, Mines will provide relief considering most transactions, cash is paid upfront. The company also plans to introduce virtual and physical credit cards in the near future and will announce with their partners when they are available.