Ethiopian fintech firm, eQub, recently emerged victoriously from the 4YFN 2024 fintech competition held during the Mobile World Congress. The company aims to digitize the traditional Ethiopian peer-to-peer credit system, Equb, reaching out to individuals with limited access to conventional credit services.
Akin to a rotating savings and credit association (ROSCAS) model, eQub is transforming the informal Ethiopian lending practice to a digital platform. In doing so, they hope to widen the financial access and empower underserved populations.
After their success at the 4YFN 2024 fintech competition, the company solidified its place on the global stage and highlighted the potential for fintech solutions in bridging worldwide financial accessibility gaps.
eQub is in the process of developing a mobile application designed for Ethiopians who have access to banking services and mobile connectivity, but struggle with gaining credit. The app aims to minimize physical ATM visits, manage cash transactions, and build a reliable credit history through a unique point-based system that tracks saving history.
The company’s model is centered on ROSCAS, requiring no collateral or interest. The income comes from transaction fees on fund withdrawals and while opportunities for service diversification exist, eQub remains focused on refining their current model.
Since its inception, eQub has garnered around 25,000 users across 200 savings groups. The platform allows users to join existing or company-organized groups. It also has robust Know Your Customer (KYC) protocols in place to ensure secure handling and management of savings.
eQub works with over ten banks that act as safeguards against potential financial losses via effective data sharing. Insurance companies are showing interest in providing targeted policies for savings groups at risk of default due to unforeseen circumstances.
eQub is aggressively planning to extend its services to gig economy workers, envisioning a user base of one million by 2025. It also aims to raise $500,000 in a pre-seed funding round for promotional activities and international service expansion.
The company’s recent success at the Mobile World Congress provides notable visibility, thus accelerating its efforts towards achieving its ambitious growth targets.
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