Accion’s Venture Lab is an inclusion incubator, fostering financial inclusion products and small business development using new data technology to promote financial access for the traditionally excluded worldwide. They provide significant investment and support for micro, small, and medium enterprise management, including access to the resources of Accion’s specialist network.
A new report titled Bridging the Small Business Credit Gap Through Innovative Lending was written with the MasterCard Center for Inclusive Growth. The report details new approaches using innovative financial technology, new analytic tools and alternative data flows to provide due diligence and new methods of credit scoring. They support a model of unbundling services from a single financial institution to smaller, more nimble niche service providers.
Micro, small, and medium enterprises are the bulk of the world economy and provide the majority of new jobs in the developing world. But growth is limited by the lack of access to capital. Venture Lab is supporting the development of local initiatives that provide unsecured capital based on new models of scoring credit, using digital and mobile platforms. New technology is reducing the burden of due diligence for small lenders by using local systems and partnerships and new cloud-based technology.
Some of the innovative fintech companies supported by Venture Lab include Tiendo-Pago and Street Shares. Tiendo-Pago is a Latin-America based micro-lender using new data technology, mobile platforms, and unique credit scoring to provide 1-2 week loans to Mom and Pop businesses. They provide services in nontraditional spaces and are encouraging a move from cash to cashless based financial systems.
Street Shares is an American small business funding option specifically for military veterans. They fund loans through a Veteran Business Bond, with a guaranteed 5% return, and investors can start with as small as $25.00 investment. Like Tiendo-Page, new data and cloud-based technology has made the due diligence.
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