If you’ve ever been refused store credit even though you have a decent job and plenty of money in the bank, you’ll understand the biggest barrier facing the financially excluded in the developing world. Often what stops people from getting loans to build their businesses or buy assets isn’t their profile as customers. They may be ideal applicants, with regular income and the willingness to repay. Their problem is proving it.
If you’re on the outside the financial system, you don’t have a credit history that a loan officer can refer to; you may not have much documentation at all. In effect, you face a Catch 22. You’re excluded from the financial system because you’re excluded from the financial system.
It’s this problem that Nicole Stubbs has been trying to address with First Access, a New York startup that mines alternative financial data, including mobile phone payment histories.