MaTontine

Our problem statement: 300M African women (74% of informal workers) demonstrate outstanding financial behavior, saving and lending $3Bn annually in saving groups, but yet do not have access to basic financial services.

We solve for this problem by digitizing traditional saving groups,Tontines – and in the process create digital identities – in order to provide access to a range of financial & non-financial services. 

Our differentiator is that we don’t just provide access to credit, but also a range of services (savings, insurance, loans, financial education etc.) via a basic, feature phone; particularly important because only 20% of sub-Saharan Africans have access to a smartphone.

Using Tontines and our customer-centric approach ensures that we can leverage this well-proven system to deliver social protection programs that exist as part of a holistic range of services for the end-user.  This we believe is how you positively impact lives at scale.

MaTontine is solving for the problem of inadequate access to basic financial services (including social protection programs) for the 300M informal sector workers in West Africa – 74% of whom are women.

The impact of the problem on target communities is enormous. Poverty alleviation is only possible when the poor have access to a range of financial services (not just credit).  An inability to therefore provide a range of safety-net services means that the target communities will remain in poverty.  Farmers can’t buy sufficient inputs and machinery; a lack of health insurance and therefore sustained illness means that people cannot generate revenues to sustain their livelihood etc.

The key reason for this problem is that 64% of West Africans are financially excluded.  While there are contributing factors (accessibility, illiteracy, financial education etc.) The core issue is that Financial Service Providers (FSPs) don’t know these people; and the excluded are skeptical of FSPs.  As most FSPs in the region rely on manual/outdated systems, the cost-to-serve this group makes it an unattractive value proposition.  Another key issue is that most governments in the region neither have the means nor the expertise to deliver these programs in a cost-effective and scalable way.

Our targets are participants in agricultural value chains.  These are usually women as they make up 70% or more of the industry.

We call our target customer Ndeye.  She is typically illiterate with a feature phone but not a smartphone and is also time constrained having to be at the farm or with her family.

Ndeye cultivates her own land using mainly family labor to produce crops for sale to meet her family's needs.  With several dependents, her resources are limited and the production of millet for consumption is insufficient to cover the entire year. The situation is made even more difficult because she has few or no resources other than those provided by this crop.

We have a collaborative customer-centric product development process that ensures we design a solution that meets the needs of our target group throughout the value chain and addresses specific barriers they face (access, trust, human touch, time poverty, financial education etc.).  We believe that facilitating women’s inclusion in the formal financial system will ultimately strengthen her role, provide a safety net that protects her and her family from income shocks, instill more stability and improve the standard of living of households and local communities.

We are solving for inadequate systems by the private or public sector that are unable to provide basic financial services & social protection programs to informal sector workers.

Our solution is the digitization of savings groups (including creating digital identities) which promote a savings culture, and are used throughout the region (~ 65% of the population). 

We then provide access to a range of services (savings, loans, insurance etc.) based on the behavior of the customer, measured using credit scores.  During enrollment, we create digital identities based on:

• Biometric fingerprint
• Proof of address
• Photo
• Telephone number
• Digital signature.

We are seeking the most practical and sustainable way to provide financial services to financially excluded informal workers bearing in mind the incredible, almost impossible obstacles they face: poor infrastructure, poor distribution to the last-mile, low literacy rates etc.

Our solution was to build an end-to-end, digital financial services platform leveraging a century-old, traditional, African financial system used throughout Africa.  Tontines are ideal vehicles to distribute financial and non-financial services including social protection because most people know how they work thereby significantly reducing the cost of training; an important point considering most our members have low levels of literacy.  What we have also found from our experience is that the secret to success in the area of financial inclusion is having common goals; and Tontines are a good conduit in facilitating that.

Our innovation however, was not merely in Tontine digitization, but an all-encompassing community made of up of our customers whereby we deliver services tailored to their specific needs.  We call this term Phygital. What this means in practice is that while we deliver our services digitally, we have built a self-serving physical community made up of our customers (we call them members).

We live in a very competitive landscape that comprises: Telcos, FinTechs, Banks, MFIs, NGOs etc.  Our competitive advantage however is that we provide a range of services based around outcome-driven solutions available via a basic, feature phone; as well as close proximity to the end-user, enabling last mile distribution.

We have been able to demonstrate over the last two years that we have been officially operational that we can recruit thousands of women, deliver financial services to them at low cost and generate revenues directly from partners who provide services (loans and insurance) to them on our platform.

To date we have over 5,000 members in 14 départments in Senegal to whom we provide 4 services to:

• Basic tontine savings
• Life insurance
• small loans
• Community loans.

Importantly, we engaged a 3rd party consultancy, Metis to undertake a monitoring and evaluation project in order to assess the impact of our solution on our members.  A summary of their report can be found below and a full report is available to the selection committee on request.

Metis Evaluation Summary

I have also attached below a report from a pilot that we did with CGAP in 2018.

CGAP-Final-Report

From a technology perspective, we use existing technology (mobile, cloud computing, artificial intelligence machine learning etc.).  Technology for us however is just a means to an end and not an end itself.  In practice, we hide almost all of the technology from the end-user.

Instead we focus on what technology enables us do.  Our solution proposes a new approach to providing an integrated solution to the financial inclusion space.  We focus on outcome-driven solutions (e.g. I want to buy a solar freezer) and then offer the right combination of services (savings, loans etc.) to achieve them - delivered from the same platform.

We define our Theory of Change as a ‘big picture’, graphical illustration of how and why our desired change of "improving access to financial services and social protection for our members" is expected to happen.

We make some underlying assumptions around the size of the financially excluded informal workers (300M); percentage of the population of people who use the tontine system; the capacity of existing payment systems to enable delivery of financial products; and our partner relationships.

The key inputs required to make attain the impact we seek are: digital identities (crucial to financial inclusion); financial, human and technology resources, and partners that enable us leverage their existing assets.

Key activities that enable us achieve our required inputs are: acquiring and onboarding associations and tontine groups; using our technology platform; development of digital financial services; creating a self-serving community of our members and integration with our partner systems.

The measurable outputs that we use to track our outcomes are: # of services, members and partners; the value of each service from the customer perspective and how many members we train on financial education and agro-ecology.

The outcomes we are seeking are:

• Safe & easy access to financial services (savings, insurance, loans etc.)
• Better financial health (financially educated, goal-based savings etc.)
• Self-sustaining communities (communities able to generate revenues and employment as well as resolve their own issues using our tools)
• Increased revenues & assets (financial and non-financial assets)
• Access to social protection (private & public: pensions, savings, social insurance etc.).

The key reason why we chose tontines as the foundation of our solution is because most informal sector workers in our region do tontines and have at least a basic mobile phone. 

We also utilize existing delivery systems (mobile/digital money agent networks) to deliver our services to our members.  This enables cash-in/cash-out operations for our members, essential to sending in their contributions and receiving disbursements (loans, grants, pensions etc.).

Social protection is only really possible if there are systems and processes in place to identify every beneficiary uniquely and track the receipt of services, as well as to establish unambiguous and efficient process flow.

A key aspect to our solution is that we create digital identities during the digitization of tontine groups using information such as biometric fingerprint capture, proof of address etc.  We have the capacity to link this unique identity with national & regional identity schemes enabling Government-to-Person transactions.

As previously indicated, MaTontine is an end-to-end Digital Financial Services platform with tools that include:

• Digital identities
• Digital payments
• Electronic signatures
• Services management
• Partner integrations
• Reporting tools
• etc. 

This enables us provide a scalable solution for social protection that facilitates: disbursement management, payment management, beneficiary management, analytics & reporting etc.

By partnering with regional digital money providers (Orange Money, Wari etc.) we are able to collect and distribute cross-border private and public transactions (pensions, savings, insurance, education bursaries, loans etc.).

The MaTontine platform was originally designed with user friendliness in mind.  We were aware from the start that our target customers had low literacy rates in terms of education and technology.  We therefore designed our solution using Human-centered Design principles.  The only skills our users need is sending and receiving digital money which they do today.

We hide all the complexity of our system from the end user.  They simply go to a mobile agent to send money or to receive money for the different services they have signed up for.

From a technical perspective, digital identities are created during the enrollment process for a tontine group.  These identities as well as all the accompanying information on the customer we create can be easily integrated with national identity registries should the government want to partner with us to deliver their social protection programs.

We have found digital (especially mobile) money as the most efficient way to collect and disburse funds.  Instead of trying to build our own mobile agent network, we have partnered with regional mobile money providers so as to use their current infrastructure to deliver our services.

We also have a community infrastructure on the ground that we use for basic training, financial education and product solicitation.  We used this structure during the pandemic to distribute financial and non-financial (e.g. basic foodstuff) aid.

MaTontine is a digital platform integrated with different partners: financial institutions, insurance companies, digital money providers etc. in order to deliver our services to the financially excluded in Africa.

As a FinTech startup where our key asset is our intellectual property we do not have open APIs or adhere to open, public standards when it comes to our technology.  Nevertheless, we are vendor and partner agnostic and make our technology easily available to our strategic partners using various integration methods: web services, FTPs, etc.

Here is a simplified customer journey to explain how these interactions might work.

1. During enrollment, we use our banking partner’s API to automatically create an account
2. We collect all the necessary KYC and enrollment information digitally and send to the bank using web services
3. The member sends their monthly contributions via mobile money which  goes via a mobile merchant account and eventually a direct transfer to a custodial account at the bank.
4. If the member is eligible, a loan can be requested from our platform and using the bank’s APIs deliver it to that member’s Orange Money wallet via our platform.
5. If she had signed up for insurance product during enrollment, then she would have sent her premium via Orange Money to us which would be transferred to the insurance partner using web services. We would then deliver the insurance product digitally to her.
6. All mobile money transactions are tracked using FTP access.

As previously indicated, we used Human-Centered Design to develop our solution for the lowest common denominator which literally means users with low literacy and numeracy living in low-connectivity environments.

An example of this is that we have an offline mode whereby all the necessary information collected during enrollment is done on a tablet and uploaded to the cloud when there is an internet connection.

Another example of is that all transactions are done using the USSD protocol and neither a smartphone nor an internet connection is required.

As an illustration, let's work through a typical customer journey:

1. MaTontine’s field agents enroll savings groups using a tablet.
2. The members go to a mobile money agent to send money using mobile money to a MaTontine account held at a partner bank
3. After a 60-90 day period they are able to establish credit profiles
4. This qualifies them for digital financial services delivered to their mobile wallet or bank account
5. They can then cash out these services from a local mobile money agent close to them.
6. MaTontine manages the entire process in the back-end and the banking partner has access to all member transactions.

The customer is unaware of the complex transactions being handled in the cloud.  The only technical competency required is sending and receiving money with the help of a mobile money agent if necessary.

As previously described we also have a community structure on the ground supported by our community manager and our local-language call center.

Member Population

• Current: 5,149
• Year 1: 32,250
• Year 5: 290,251

We are projecting a rapid growth in numbers over the next 5 years because of our Business-to-Business-to-Consumer (B2B2C) model.

As a company, we have invested in building a multi-sided, partner-friendly, Digital Financial Services (DFS) platform that we can leverage in working with a range of stakeholders within the financial inclusion industry: Banks, MFIs, NGOs, Telcos, women groups etc.

With our range of utilities that comprise: digital identities, biometric capture, electronic signatures etc. (see below) we are able to deliver “plug & play” solutions for different stakeholders to enable them meet their financial inclusion goals. 

This could be working with an NGO in Côte d'Ivoire to digitize their savings groups; or a diasporan health insurance product for Nigerians purchased by their relatives abroad who want good healthcare for their families back home; or a comprehensive digital financial services solution for a Microfinance institution that wants to serve financially excluded women in Senegal.

For the end-user, we are able to offer a range of services through our platform that include:

• Basic book-keeping
• eLearning modules
• Digitized savings groups
• Insurance
• Loans
• Loan-based savings
• Opening of bank accounts
• Pensions
• Income protection insurance
• etc.

In the next five years we anticipate being in 4 additional countries: Côte d’Ivoire, Mali, Cameroun and Niger. 

We expect to achieve such significant growth by partnering with financial and non-financial organizations in each country and employing our “Operating System” for Financial Inclusion approach.  This enables us provide our Digital Financial Services (DFS) to various stakeholders within the financial inclusion (FI) domain who need an integrated digital platform to meet their strategic FI goals but don’t have the platform to do so.

The table below describes our key impact metrics:

In the next year the principal barrier to us accomplishing our goals is the COVID pandemic.  If there is going to be a second wave as some experts are predicting, this would be a disaster for the world-wide economy and for our target population in particular.

Otherwise, we typically have 3 main challenges as a business: regulation, partnerships and talent.

Working within the West African Monetary and Economic Union (also known under the French acronym, UEMOA) presents unique regulatory challenges.  For example, there are no specific regulations for FinTech companies like us.

As a small FinTech company we are forced to work with Partners (Financial Institutions, Mobile Payment companies etc.) as we cannot build out the infrastructure that these companies already have.  This also brings its own challenges because large companies are not always well-equipped to work with small technology companies.

Finally, a potential impediment to our growth is high-level talent acquisition.  Finding top talent in our region is very difficult, and when you do, they tend to be very expensive; as you are competing with all the top banks, consultancies, telcos etc. for that talent.

Regulation: in the short term, we mitigate the problem with regulation by partnering with accredited financial institutions like Cofina Senegal and Ecobank.  In the long-term though, we intend to adopt FinTech regulations currently being developed by the regional central bank.

Partnerships: We have actually been very successful in acquiring top regional partnerships (Ecobank, Cofina, SUNU Assurances, Wari, Orange Money etc.).  Nevertheless, these are complex partnerships to negotiate as the speed and strategy of a FinTech startup is not always perfectly aligned with that of a large, legacy company.  The best approach to resolving this problem is by constantly demonstrating value to the large company.  We do this typically by proving through pilots that we are able to bring the partnership competencies that the large company cannot easily develop.

Talent Acquisition: Finding, acquiring and keeping top talent is undoubtedly difficult because it is a "sellers" market as described above.  Unlike in  developed countries where one can offer equity as a significant portion of the compensation package, in our region, we have found this not to be particularly valuable.  We try to overcome this problem by seeking to recruit diasporan Africans who want to come back; and we have had some success with this.

We currently have 13 full-time staff working in operations, business development, software development, call center and field operations.

The MaTontine team has over 20 years’ experience doing digital transformation around the world with different types of companies including: American Red Cross (USA), Lutheran World Relief (USA), ipNX (Nigeria), Cofina (Senegal) etc.

Over the last 3 years we have specialized in digital financial services as a pure FinTech company.  Our solution is based on digitizing traditional, Tontines and then based on customer behavior – which we measure by credit scoring based on our artificial intelligence and machine learning algorithms – are able to deliver a range of financial and non-financial services working with a range of existing partners: banks, microfinance institutions, insurance companies, mobile payment providers education providers etc.

We have extensive experience developing digital financial products for women (majority of informal workers).

Through our relationship with Women’s World Banking (we are part of their SheCounts network), we acquired expertise in Human Centered Design (HCD) which we use in developing all our products.  For example, we used it to design our flagship product Tontine Advances; as well as our Loan-based Savings product for market women.

The cofounders of MaTontine, Dr. Tosan Oruwariye and Bernie Akporiaye are diasporan African entrepreneurs with international experience.  Tosan is a medical doctor and entrepreneur based in New York City, but with extensive experience working with governments and NGOs like WHO & UNICEF in Africa; she is an expert in last-mile distribution.  Bernie has over 20 years’ experience working internationally and Africa and is a qualified accountant and financial software expert on his 4th startup.

Our platform integrates with different partners: banks (Ecobank), MFIs (Cofina Senegal), Insurance Companies (SUNU Assurance), Digital Money providers (Wari, Orange Money) in order to deliver our services to financially excluded women in Francophone Africa.  Apart from Ecobank whom we signed a partnership with last year, we have been in partnership with the others for about 3 years.

MaTontine is integrated into our partner systems so they can deliver their services digitally through our platform.  Below is a table of our existing partners and how we work with them.

One of the key problems for the financial inclusion industry is how to reach these excluded groups in a cost-effective way.  On one hand the FSPs are far away from them; know very little about them, and their current business model make it unprofitable to serve them.  On the other hand, the financially excluded are skeptical of FSPs and see them as high cost providers who are difficult to work with.

Our value as a company is that we bring these two groups together so they can interact in low-cost relationship.  For the FSPs, we digitize their service delivery so they can provide their products at lower cost (as well as expand their product portfolio). For the financially excluded we are able to use their familiar tontine process to provide them services and therefore bring them into the formal financial industry; and in the process take them on a journey into financial inclusion (see graphic below).

Our customer acquisition strategy is to work with associations (farmers,
women, fishermen etc.) and provide them with access to a range of
services (finance, financial education, basic book-keeping, agricultural
inputs etc.) provided by our partners.  So, in some instances, the
members of these associations pay us a small monthly fee for these
services; and also our partners pay us a commission for bringing them
these customers.

We generate revenues in one of three ways:

1. Membership fees

2. Commissions from partners (or transaction fees)

3. Partner project fees.

MaTontine is a For-Profit company and while we have received grants in the past, and expect to receive some in the future, our business model is based on generating revenues in these three ways:

1. Membership fees from beneficiaries
2. Commissions/transaction fees from partners
3. Partner project fees.

The first two revenue streams were explained previously.  The 3rd, partner project fees, relate to offering our entire platform to different stakeholders who want to implement Financial Inclusion projects but do not have a platform to do so.  These organizations could either spend years developing a sophisticated digital financial services platform or partner with us to use ours to meet their financial inclusion goals.

We are hoping to raise about $500K over the next 18 months (pandemic permitting) to enable us expand our operations to Côte d’Ivoire and are likely to raise more financing in the coming years, but we are anticipating being profitable and financially sustainable by 2023.

Please find below a table with funding sources.  As a private company however, we are are not comfortable making our financials public. We would on the other hand be happy to share it with the selection committee.

We are looking to raise $500K over the next 18 months as equity (pandemic permitting). 

We do have a budget, but as per the response to a previous question, being a private company we are are not comfortable making our financials public. We would however be happy to share it with the selection committee.

Our principal reason for applying to the WURI West Africa Prize is the opportunity to engage with the World Bank Group and learn from some of the incredible competencies developed within their CGAP team, as well as initiatives like Universal Financial Access.

We strongly believe that individual institutions working in silos would not be able to solve the daunting challenges around financial inclusion. We see the World Bank as a key influencer within the ecosystem, capable of bringing different stakeholders together to solve the complex problems that the industry faces.  Whether it is working with the regional central bank to develop a sandbox for FinTech regulation; promoting a regional digital identity registry; facilitating the building of a rural agent network for last-mile distribution to rural communities; or digital financial services for excluded groups.  We hope for an opportunity to interact with the World Bank and its network within this space and we would like play a key role in the ecosystem.

As previously indicated earlier in this application, we are actively seeking partnerships with stakeholders within the financial inclusion who seek to play a significant role within the domain but do not have all the different pieces to make that happen.  We hope during this challenge to raise awareness of our offering which include:

• Developing a financial inclusion strategy
• Building digital financial services based on Human Centered Design
• Access to a fully-fledged Digital Financial Services Platform
• Etc.

We have a goal to serve 1M members by 2025.   To do that we need a range of partners and their infrastructure.  To that end we need business partners with whom we can jointly pursue congruent financial inclusion goals.

In our region of Francophone West Africa region, we operate within a very complex and inflexible regulatory environment.  This represents a particular risk which we mitigate by partnering with the right accredited partners, while we remain a technology platform.  These might include:

• Financial Institutions: Ecobank & Cofina Senegal
• Insurance Providers: SUNU Assurances & Inclusivity Solutions
• Digital Payments Providers: Wari & Orange Money
• Education Providers: Entreprenarium & Mosabi

Our partnership goals are to increase the number and types of partnerships to enable us offer an ever-increasing range of services to the end-users: access to agricultural inputs, solar products, business training etc.

We want to be the default platform for the industry.

The table below lists the type of partnerships we would like and the role that they play in the outcomes we seek.

Agricultural and Women associations | As most informal workers within agricultural value chains do tontines, we would like to work with their associations so together we can offer a range of services to them in a holistic way (e.g. access to finance, financial education, access to agricultural inputs, loss of income insurance, crop insurance etc.)

Lenders (Ecobank, Banque Agricole) | Automate the lending process using our artificial intelligence & machine learning tools.  We can collect the information required for them to make a quick lending decision.

Insurers (SUNU, NSIA) | Create bespoke insurance products (crop insurance, health insurance, life insurance, loss of income etc.) for our members.

Digital Money providers (Wari, Orange, MTN) | Provide regional partnerships, so we don’t have to spend months in each country trying to get a partnership with each particular subsidiary.

Financial Education Providers | Co-develop a gamified education experience linked to a real-life, goal-based journey to financial inclusion. 

Solar Energy Providers (Oolu, Baobab+ | Integrate their offerings into our portfolio of products & services that we offer our members.

Agricultural Input Providers | Provide discounted inputs (seeds, fertilizer etc.) to our members.

Government Agencies (Women, Social Protection, Agriculture etc.) | Integrate our digital identity tool into government social protection programs to enable the digital delivery of Government-to-Person initiatives like Universal Healthcare, school bursaries, pensions etc.