Moni unveils community-powered loans to drive SME growth in Africa

By Gloria Methri

Moni has launched a new range of business loans that enables market traders, spare part dealers, textile traders, and other small business owners in Africa to take advantage of their communities in accessing the working capital they need to scale their businesses.

Moni is pioneering a community finance model that builds on the importance of group responsibility in African communities to improve access to financial services for small business owners.  The company has built a risk engine that combines financial data and business performance with social intelligence to enable more effective credit decisioning for SMEs.

Starting with Nigeria, small business owners with a good social reputation can join a lending cluster with an invite from an existing Moni user. Once eligibility has been confirmed, they can access financing in 5 minutes or less. Once the loan is disbursed, the cluster shares responsibility for the loan, and members are able to access funds from an automated savings pot to bail out members if needed.

Mpni, a Y Combinator-backed startup launched the pilot of its community-powered loans in August 2021 with 3,000 mobile money agents. In 2022 alone, the company disbursed more than $22 million in loans to 11,000 SMEs, with a 99% repayment rate. Building on the success of its community-powered model, the company is now delivering financial services to a wider range of African SMEs.

Femi Iromini, CEO and co-founder of Moni said “Our community-powered business loans product is just one of the ways we are innovating around our unique context in Africa to make the most of what is already in place to deliver the financial services business owners need to create long-lasting wealth for themselves and their communities. We have ample evidence to show that this approach works and we are excited to be bringing more businesses on board to drive the economic development we all want to see on the continent.”