Economic prosperity through BarEl application
- Malawi
- Hybrid of for-profit and nonprofit
Peace and stability are baseline conditions for economic prosperity and a thriving society, and both are at risk with escalating economic shocks. Poverty and lack of quality jobs contribute to conflict.
Technology can lead to more precarity.
Many people, including workers, in Malawi lack economic opportunities, that is, the options a person can pursue to achieve financial autonomy because of the absence of adequate education and training, and an economic climate in which legitimate businesses can grow. People also lack economic opportunities because they are deficient or are limited in the following: high quality education, pathways to careers, access to healthy food, affordable healthcare and financial literacy. Financial literacy skills; include, personal financial management, budgeting, saving, debt and investing.
Lack of financial literacy and business management skills pose a challenge for many people to access credit because they can not prepare a business plan let alone break even analysis and financial statements. Because they lack financial literacy and business management skills, their businesses fail; consequently, they do not have viable assets to show to lenders as collateral or security.
Lack of financial literacy leads to accumulation of unsustainable debt burdens either through poorest spending decisions or a lack of long-term preparation. This, in turn, can lead to poor credit, bankruptcy, housing foreclosure, or other negative consequences.
According to Consumer Association of Malawi, only 3 percent of Malawians, including workers, are accessing credit facilities because of financial illiteracy. Accessing credit from informal lending institutions or loan sharks has led to credit traps that result in confiscation of property.
Many entrepreneurs in Malawi encounter enormous challenges to acquire credit. This impedes economic growth, rendering millions and millions of Malawians trapped in a poverty cycle.
The following are some of the barriers to accessing credit:
1.Poor credit score .
2.Lack of financial track record.
3.Lack of capacity to manage risks.
4.Barriers based on age, sex, disability, race, ethnicity, origin, religion or economic or other status.
Many Malawians are unbanked due to several reasons like illiteracy and unemployment.
About 70% of Malawi's population lives below the $2.15 international poverty line. The marginalised, people with disability, women, youths, people with low income and some workers may want to start small businesses, but the stumbling block is lack of capital. Many marginalised groups like women, youths and peasant farmers are denied access to loans. Most of them do not have entrepreneurship skills like skills to write a business plan, which is a prerequisite to access credit. When these people want to access credit from banks or microfinance Institutions or lenders, they are required to provide collateral or security, which they may not have; hence, they are denied to acquire loan capital or the prospective loan applicants are discouraged to borrow at all because they may not have security.
Lack of credit has negative consequences for poor people’s agricultural productivity, food security, health and overall household welfare.
Some prospective loan applicants may be discouraged to borrow because of high interest rates offered by lenders.
My team and I believe in positive lasting change. Our solution uses technology; specifically, BarEl application, which we developed. It brings about economic prosperity. It reduces or eradicates poverty. It improves access to credit, facilitates effective management of risks and equips individuals with right business and financial literacy skills.
Our solution helps to achieve a situation in which people have economic opportunity. It facilitates adequate education and training, an economic climate in which legitimate businesses can grow, and promotion of peace and prosperity.
Our solution facilitates more inclusive financial systems and creates new job opportunities like information technology jobs.
It fosters financial and digital inclusion by supporting access to credit.
It generates new economic opportunities and buffer against economic shocks for workers, including good job creation, workforce development, inclusive and attainable asset ownership by facilitating good economic decisions and proper human resources management.
Our solution equips users with digital skills and other skills, which are much sought by employers.
It equips people with financial literacy and business management skills that enable businesses to thrive; hence, growth of asset base to be used as collateral. The business management skills enable entrepreneurs to prepare business plans that include financial statements and break even analysis that are vital for getting credit applications to be approved. In the same vein, financial literacy skills and business skills enable people to make right decisions and manage their resources effectively and efficiently.
The financial literacy and business management skills enable individuals to budget, manage and pay off debts, understand credit and investment products, keep track of expenses, make timely payments, save money prudently and check credit reports.
BarEl application is packed with all components of Business Administration. In short, it is MBA made simple, setting users on a path towards a prosperous and financially responsible future. Among other things, BarEl application assists entrepreneurs in technical and fundamental analyses, in keeping records, controlling inventory, financial reporting, managing human resource, finances, operations, transport, sales, marketing, risks, small business enterprises and economics. The records can be used to determine the creditworthiness of users.
Our solution enhances consumer empowerment and effective financial education by promoting financial literacy initiative; and increasing access to affordable credit facilities through promoting school based financial literacy.
The solution enables individuals to acquire foundational skills like reading and writing.
Our solution breaks barriers to accessing loans like: age, race, tribe, home of origin or gender.
Our solution helps to effectively manage risks by identifying, analyzing, prioritising, treating and monitoring them.
The target population whose lives we are working to directly and meaningfully improve includes; workers, lenders, borrowers, entrepreneurs, governments, economists, planners, women, children, girls, youths, everyone, women, children, girls, youths, everyone, LGBTQ+, pre-primary age children (ages 2-5), primary school children (ages 5-12), rural, peri-urban, poor, low-Income, middle-income, high-income, refugees and internally displaced, minorities and previously excluded populations, and persons with disabilities.
The target population is currently underserved in that they can not access credit or they are unbanked due to limited or no knowledge or skills in financial literacy and business administration; and also due to low levels of literacy (foundational skills) and due to being unemployed because of poor economic conditions.
They are also currently underserved in that they do not have collateral, they do not have digital, financial literacy and business skills.
They are also currently underserved in that lenders, economists and the like, lack tools for analysis and decision making. Consequently, they make poor economic decisions, that translate into economic stagnation and poverty.
The solution will address their needs by:
1. Training and educating workers, entrepreneurs, students, farmers and the general public on financial literacy and business administration. BarEl application helps individuals to become financially literate, improve their business or budgeting skills, and increase their business planning acumen. By doing so, our solution contributes to reducing poverty, boosting revenue for businesses, improving food security, and promoting sustainable economic development.
2. Enabling individuals to prepare business plans which lenders require before approving credit.
3.Facilitating businesses to grow or thrive; in the process, growth of assets that are used as collateral.
4.Formulating and reviewing financial sector policies and providing MSME support for growth.
5. Helping planners and economists to make right economic decisions like public sector investment plans and decisions on loan acquisition, macro-economics and micro-economics.
6.Digitising of government payments and receipts.
7. Promoting social, economic and political inclusion of all, irrespective of age, sex, disability, race, ethnicity, origin, religion or economic or other status.
We are constantly engaging our target population in development of our solution through one to one discussion or through meetings. During such meetings, our target population suggests to us what improvements to make to our solution.
The solution will impact their lives as follows:
1. Enhanced consumer empowerment and effective financial education.
2. Enhanced policy and regulatory framework for the financial sector.
3. Improved digital payments ecosystem in the financial service provision.
4. Increased savings and investment opportunities
5.Increased access to credit targeting women, youths, workers, farmers and MSMEs.
6.Increased generation of new economic opportunities and more buffer against economic shocks for workers.
7.Increased good job creation.
8.Better workforce development.
9.More inclusive and attainable asset ownership.
10.Sustained peaceful and prosperous economies.
All in all, communities will experience improved economic prosperity through economic growth and development. The economic situation of affected communities improves as financially literate individuals become more productive.
Below is the explanation of how and why my team and I, are well-positioned to deliver this solution:
TK Computers & Consultancy team members are professionals.
Thumbiko Shumba, the Chief Executive Officer, leads our team. He brings over 20 years of experience in management. He retired as Deputy Director of Finance in the Malawi Government. He worked as a secondary school teacher. He developed BarEl application, which is providing efficient intervention in Malawi. He has extensive experience in research, data analysis, monitoring and evaluation.
Tiwonge Kuyokwa, Mwawi Mbewe and Mphatso Simfukwe add value to the team with their experience. They are experienced trainers.
We are professionals with a diverse range of skills, knowledge, hands-on experience in project management, IT, education, business administration and financial management that help us to enhance economic or financial outcomes. We leverage our expertise together to foster creativity, critical thinking and problem-solving skills; thereby, achieving better outcomes and overall development.
We incorporate human-centred design. Inclusive and equitable outcomes are considered in the design, implementation, and internal operations of our solution.
Our team is ethnically diverse and inclusive. We are gender-balanced.
We have direct experience with the communities that we serve. We were all born, raised, live and work in the communities we serve. We interact with our target audience on almost daily basis, enabling us to understand the challenges they encounter.
We nurture human potential.
We are fluent in the language of our target market; hence, enabling effective communication.
We utilise human-centered design principles to ensure that our solution is user-friendly and accessible.
The design and implementation of our solution is meaningfully guided by the communities’ input, ideas, and agendas. We prioritise communities' input and feedback. We get feedback on our solution from community leaders and members to understand their needs and experiences. We involve community leaders in our undertakings: This makes their people to accept us; thereby, ensuring lasting commitment and local ownership. We collect data through surveys, focus groups, interviews and consultations.
We are capable of coordinating, organizing, planning, directing and delivering results.
We are compact, agile and motivated to drive the innovation towards scale.
Our team has a strong commitment to accountability and delivering quality outputs.
We have a deep understanding of our organisation's goals.
We have a realistic, practical plan for implementing the solution, and it is feasible.
We have set up robust communication channels that facilitate communication and quick decision-making.
We have a network of partners, including community-based organizations, giving us the opportunity to tap knowledge and experience through collaboration.
We are a team that has supported one another in many ways.
We are geared to create positive lasting change.
We have a sound theory of change.
We provide consulting services.
We have an active advisory board.
Lastly, we are well-positioned to deliver the solution to the target population; owing to our proximity to the communities we serve and our commitment to human-centered solutions. We leverage our dexterity and expertise, promote partnerships, maintain robust communication channels and prioritise activities.
- Generate new economic opportunities and buffer against economic shocks for workers, including good job creation, workforce development, and inclusive and attainable asset ownership.
- 1. No Poverty
- 2. Zero Hunger
- 3. Good Health and Well-Being
- 4. Quality Education
- 5. Gender Equality
- 6. Clean Water and Sanitation
- 8. Decent Work and Economic Growth
- 9. Industry, Innovation, and Infrastructure
- 10. Reduced Inequalities
- Pilot
The detailed reasons we selected the stage above are explained below:
We already moved from the concept stage and prototype stage, and we are now in the pilot stage. So far, we have developed an application called BarEl.
Our solution has been launched in at least one community, but is still iterating on design or business model. It is working to gain traction. It has 10+ users/direct beneficiaries. It is a full product but released on a small scale to a select group of users or a small audience aimed at collecting valuable feedback.
We conducted the following studies under pilot stage: baseline survey and foundational study. Under baseline survey and foundational study (literature reviews, desktop research) we found out that Malawi, Sub-Saharan Africa, and the entire world are going through financial or economic crises. Globally, access to credit, financial illiteracy, economic shocks and lack of foundational or business skills impede economic prosperity.
We are carried surveys through focus groups and interviews from the community we target. Data gathered from the surveys is informing the design.
We have just concluded formative study (usability study; feasibility studies; case studies; user interviews; process evaluation and correlational studies). The formative study revealed that there is a correlation between economic or financial outcomes and use of BarEl application. The study showed that all users of BarEl application, including workers, were able to access credit, and that they were not heavily and negatively affected by economic shocks. The study also showed that entrepreneurs who started using our application experienced positive financial performance in their businesses. The study showed that users of BarEl application used it, without any problem. The study also revealed that the application passed the following feasibility tests: technical, operational, economic or financial, legal, market, cultural and political.
We measured user experience qualities like usability, functionality and desirability to mitigate risk so as to save us from making a large investment into something users will not adopt.
Focus groups, case studies, and user interviews were conducted: They revealed that respondents scored highly on preference and favourability tests.
We are currently using live data and we are delivering a live service or activity. Our product is actually going through the normal implementation and service transition processes.
We are at the first stage of an implementation. It is an initial small-scale implementation to prove the viability of our solution. It is a test release of our product to a select group of users, designed to gather feedback and validate assumptions. We are exploring a novel approach. We are using or modifying live data. We are limited in scope in that we have a limited number of users.
Our product is at a pilot stage where it can be useful to iron out any minor creases, or understand how it works in reality, before expanding use. We are at a stage of identifying any deficiencies, to make minor changes to the solution and to manage the risk of the product before substantial resources are committed.
So far outcomes of the pilot stage are compelling us to roll out the full implementation after making minor changes to the solution. We are carrying out surveys through focus groups and interviews from the community we target. Data gathered from the surveys is informing the design and the pricing model.
Our solution is hybrid of for-profit and nonprofit. It has raised little investment capital through the personal savings of the CEO, Mr Thumbiko Shumba.
Before our solution entered the pilot stage, it passed through the concept stage and the prototype stage.
During concept stage, we did a small exercise to test the real-world potential of our idea in the early stages of developing our product. We did not deliver the idea for live use but demonstrated whether it was feasible. And we came to the conclusion that our product can be developed.
During prototype stage, we conducted prototype testing to evaluate performance quality, conformance quality, durability, reliability, repairability, style, design, usability, favourability, desirability and preference of BarEl application. The application passed the prototype testing.
The prototype was put through rigorous functional tests and customer tests. We did the alpha testing to see how our prototype performs in different scenarios. We also did beta testing by enlisting customers to use the prototype and give feedback on their experiences.
We also did consumer testing by offering freemium. We have achieved an impressive migration rate from the freemium to the subscription model.We have sold the product to very few end-users.
We also did market testing to learn how large the market is, and how consumers and dealers react to handling, using, and repurchasing our application.
The major methods of market testing we applied are: sales-wave research, test markets and market-tested at trade shows.
We also conducted the following feasibility tests to check if our prototype is feasible or infeasible.
Technical Feasibility Test: . Our application passed the test. Below are some key elements which we assessed for technical feasibility :
- Technological Stack - programming languages and operating systems, front-end framework, back-end framework, data storage and querying.
- Availability of resources: the availability of a skilled workforce with diverse expertise and knowledge.
- Integration and compatibility: Our application functions smoothly with different types of hardware .
- Risk assessment: We assessed the possible risks that could arise during product development and we strategized contingency plans.
- Security and compliance: We identified and evaluated security vulnerabilities to avoid situations like data breaches, loss of data, or severe system malfunction. Our application has a security feature that has multifactor aunthentication, in other words, password security with multiple layers of protection. It also has a backup for data recovery.
- Scalability: Our product has the ability to accommodate future growth due to increasing user demand without major glitches in performance.
- Monetary constraints: Our project’s budget is not enough if we are to scale. We need support from Solve.
Operational Feasibility Test: Our application passed the test. We did tests on whether our application is easy to operate or maintain after deployment or usable.
Economic or Financial Feasibility Test: We analysed whether or not our project is fiscally viable. We conducted cost-benefit analysis and it revealed that the benefits of the solution outweigh their costs.
Legal Feasibility Test: The test revealed that our solution conforms to the legal and ethical requirements in Malawi and beyond.
Cultural and Political Feasibility Test : The test showed that we will manage change. The suggested changes would be received owing to the involvement of the target population in the project.
Market Feasibility Test : We evaluated how the project’s deliverables will perform in the market through a market analysis, market competition breakdown, and sales projections. The test found that there is a feasible market for our solution.
The following are specific financial, technical, legal, cultural, or market barriers that we face and hope Solve can help us to overcome:
Financial barriers: This includes: challenges in pitching to investors and lack of easy fundraising process that diminishes our financial position, which negatively impacts our operations.
Technical barriers: This includes challenges in accessing cloud services, managing time, navigating team dynamics, adapting to new technologies and compatibility issues.
Legal: We face challenges in license and distribution agreement, intellectual property and international laws for applications.
Cultural: We face challenges in cultural compatibility where beliefs, values, and customs may mismatch. We work in communities where the local populace can not comprehend the language we have used in our application. We anticipate language barriers in countries where French, Portuguese and Swahili are used as languages of instruction.
Market barriers: They include: competitive rivalry, threat of substitution, threat of new entrants, challenges in distributing our product, and in web development or design.
Our solution would benefit from some of the resources that the Solve community can provide.
We are applying to Solve because of the following reasons:
- We want Solve to help us to access in kind and pro-bono resources to empower our innovation journey and support our growth. We need financial help for operations. We need funding in the form of grants and investments, including through prizes and Solve Innovation Future. We want funding opportunities to scale up the solution.
- We want Solve to support us in pitching to investors.
- We want Solve to help us in Product / Service Distribution (e.g. expanding client base)
- We want Solve to help us in web development/design.
- We want Solve to help us to join a class of impressive peers that act as a trusted support group, offering inspiration and guidance.
- We want Solve to help us to join a powerful network of impact-minded leaders across industries and sectors, with dedicated spaces to meet year-round and during Solve’s flagship events such as Solve at MIT. We are excited to connect with Solve, as we believe that by associating with it and the connections it offers, we can reach the next level in our work.
- We want Solve to help us to access leadership coaching and strategic advice from experts in the Solve and MIT networks.
- We want Solve to help us to receive monitoring and evaluation support to build an impact measurement practice.
- We want Solve to help us to gain exposure in the media and at conferences.
- We want Solve to help us to access relevant in-kind resources such as software licenses and legal services from Solve supporters.
- We are looking for support from MIT Solve to access more partners, mentorship, technical expertise, media publicity and exposure, impact measuring and monitoring, and business development assistance, that can help us scale our solution and make a greater impact. We want to tap into a network so as to leverage international and local partnerships to grow and scale up the solution.
- Business Model (e.g. product-market fit, strategy & development)
- Financial (e.g. accounting practices, pitching to investors)
- Legal or Regulatory Matters
- Monitoring & Evaluation (e.g. collecting/using data, measuring impact)
- Product / Service Distribution (e.g. delivery, logistics, expanding client base)
- Public Relations (e.g. branding/marketing strategy, social and global media)
- Technology (e.g. software or hardware, web development/design)
CEO & Founder