Utiva Design School Business Case

About ZedCrest

Zedcrest Capital is a full-service capital management firm, with core interests in fixed
income securities trading, asset management, and proprietary investments.

http://www.zedcrestcapital.com

The Case
Problem Statement
Many mid-level income earners complain that accessing loans can be very bureaucratic,
stressful and disappointing. Banks and other financial institutions need some form of
documentation, processes, and verification during the entire application process which also
informs the approval and disbursement.

While many industry leaders acknowledge that access to credit and quality financial
services is a human right, the process involved can be quite discouraging. Some banking
reports show that more 85% of loan applications are abandoned due to the bureaucracies.

Problem Description

Although many financial experts say that requesting some forms of documentation,
identification and verification seems inevitable, the complex process of providing
documentation manually before loans are disbursed makes the process unattractive to the
class of professionals, entrepreneurs and income-earners that need these facilities. The
biggest question on the mind of many experts(and customers), however, is how lenders can
leverage already existing banking information like BVN, to structure a model that allows
loan accessibility to the end-users.

To bank in Nigeria, customers are required to have a Bank Verification Number (BVN). The
Bank Verification Number commonly called BVN is a biometric identification system
implemented by the Central Bank of Nigeria to curb or reduce illegal banking transactions
in Nigeria. The BVN by extension has also served the purpose of preliminary documentation
and also helped the banks to achieve the 'Know Your Customer (KYC)' clause of ethical and
effective banking. In fact, many Fintechs have debated that with a system that works by
recording fingerprints and a facial photograph of the customers, Humans do not have to
show at the banking hall to access loans.

From the bank’s perspective, there are many reports and thoughts that there are many
underlying factors that form major constraints that make manual processes a necessity.