FinCare

The specific problem that FinCare is working to solve is the lack of access to financial services and credit for underserved communities in Tanzania and across Sub-Saharan Africa.

In Tanzania, only 17% of the population, or approximately 10.5 million people out of a total population of 60 million, has a bank account, and less than 10%, or 5 million people, have access to formal credit. This leaves the majority of Tanzanians, especially those in rural and low-income areas, without the financial tools needed to build economic stability and resilience. 

Across Sub-Saharan Africa, the problem is even more acute. Over 57% of the adult population, or more than 350 million people, are unbanked, meaning they lack access to basic financial services like savings, credit, and insurance. This financial exclusion disproportionately affects women, who make up 64% of the unbanked population in the region.

Factors contributing to this problem include limited physical bank branch infrastructure, high costs of traditional financial services, lack of credit history and collateral, and low financial literacy. These barriers prevent underserved Tanzanians and other Sub-Saharan Africans from accessing the credit and financial management tools they need to start and grow businesses, cope with unexpected expenses, and build long-term wealth.

Addressing this problem of financial exclusion is crucial for promoting economic prosperity and stability in Tanzania and the broader region. Without access to affordable credit and financial services, millions of individuals and families remain trapped in cycles of poverty and vulnerability to economic shocks.

FinCare's solution is an innovative financial platform that provides AI-driven microcredit and debt management services to underserved communities in Tanzania.

At the core of FinCare's offering is its AI-powered microlending system. By leveraging alternative data sources and machine learning algorithms, FinCare is able to accurately assess the creditworthiness of individuals who lack traditional credit histories. This allows the platform to extend small, short-term loans to those who are typically excluded from formal financial services.

In addition to its microcredit capabilities, FinCare also features an intelligent chatbot-based financial assistant. This digital tool provides personalized guidance on budgeting, expense tracking, and debt management. By empowering users to better understand and control their financial situations, the chatbot helps FinCare's customers develop healthier financial habits and effectively manage their debt.

Crucially, FinCare places a strong emphasis on data security and user control. The platform incorporates robust privacy safeguards and gives individuals the ability to manage their personal financial data, ensuring that its solutions respect the autonomy and digital rights of the underserved Tanzanian communities it serves.

Through this combination of AI-driven microcredit and intelligent financial management tools, FinCare aims to address the unique needs and challenges faced by marginalized populations in Tanzania. By extending access to affordable credit and empowering users to take control of their financial lives, the platform seeks to drive financial inclusion and create a more equitable and resilient financial ecosystem in the country.

According to the information provided earlier, FinCare's target population in Tanzania includes the majority of the country's 60 million people who currently lack access to formal financial services.

Specifically, the solution is designed to serve the approximately 50 million Tanzanians, or 83% of the population, who do not have a bank account. Additionally, it aims to reach the estimated 55 million Tanzanians, or 90% of the population, who do not have access to formal credit.

This underserved population includes smallholder farmers, informal workers, women, and youth - groups that are disproportionately excluded from the traditional financial system in Tanzania. By providing AI-driven microcredit and intelligent financial management tools, FinCare seeks to directly address the needs of these marginalized communities and enable them to build financial security, resilience, and long-term prosperity.

FinCare's team is uniquely positioned to deliver this solution to underserved communities in Tanzania, drawing on their deep ties to the target population and a design process that centers community input.

Leading the FinCare initiative is Costantine Edward, the CEO and co-founder. Costantine is a seasoned Tanzanian entrepreneur with over a decade of experience in financial technology and inclusive banking. His personal experience growing up in a low-income household in rural Tanzania informs his unwavering commitment to expanding access to credit and financial services for marginalized groups.

Joining Costantine on the FinCare team are three other Tanzanian innovators, each with strong connections to the communities they aim to serve:

• Asha Mwakisupe, the Head of Financial Inclusion, has spent years working directly with women's cooperatives and smallholder farmers in Tanzania to understand their unique financial needs and barriers.
• Elias Mshana, the Chief Data Scientist, has expertise in leveraging alternative data sources and machine learning to develop credit assessment models tailored to underserved populations.
• Neema Kilonzo, the Director of Human-Centered Design, has facilitated extensive co-creation workshops with potential FinCare users to ensure the solution is responsive to their priorities and pain points.

This diverse team, composed of Tanzanian leaders with deep roots in the communities they serve, has been instrumental in shaping FinCare's design and implementation strategy. By centering the voices, ideas, and lived experiences of the target population, the FinCare team is able to develop a solution that is not only technologically innovative, but also culturally relevant and responsive to the unique needs of underserved Tanzanians.

For the FinCare solution, we have reached the Pilot stage. The platform has been launched and is currently serving a initial cohort of 132 rural women in the Mwanza region of Tanzania.

Through a collaborative design process, the FinCare team worked closely with this target community to develop and test the microcredit and financial management tools. This included gathering feedback on the user experience, assessing the appropriateness of loan products and repayment terms, and iterating on the chatbot-based financial assistant.

In the pilot phase, FinCare has been able to extend small, short-term loans to the 132 rural women participants, many of whom previously lacked access to any formal credit. Initial data shows that these microloans have enabled the women to invest in their small businesses, cope with unexpected expenses, and build their credit histories.

Alongside the microcredit offering, the FinCare chatbot has also provided personalized financial guidance to the pilot participants, helping them develop budgeting skills and better manage their debt. Qualitative feedback indicates that this financial empowerment component has been transformative for the women's overall financial wellbeing and decision-making capabilities.

While still in the iterative pilot stage, the FinCare team has been encouraged by the positive impact observed thus far. This initial success has reinforced the team's confidence in the solution's potential to drive meaningful financial inclusion and economic empowerment for underserved Tanzanian communities at scale.

FinCare is applying to Solve to access the program's multifaceted support and resources, which we believe will be instrumental in overcoming key barriers to scaling our solution in Tanzania.

The primary barriers we face are:

Financial: As a social enterprise, FinCare requires additional funding to expand our reach and deepen our impact. The Solve prize funding, as well as the potential to connect with Solve's extensive partner network, would provide the critical capital and investment needed to scale our microcredit and financial inclusion services.

Technological: Developing the AI-powered credit assessment and chatbot tools that underpin FinCare's platform has been resource-intensive. Solve's access to technical expertise and mentorship could help us optimize our technology stack and ensure its seamless integration with the needs of our target users.

Cultural: Introducing new financial services in traditionally underserved communities requires a deep understanding of local contexts and building trust. Solve's diversity of global expertise and connections to on-the-ground partners in Tanzania would be invaluable in guiding FinCare's culturally-sensitive expansion.

Beyond just funding, FinCare is eager to leverage Solve's robust network and renowned thought leadership to open up new strategic partnerships, policy advocacy opportunities, and avenues for knowledge-sharing. This holistic support would bolster our ability to drive sustainable financial inclusion and long-term economic empowerment for marginalized Tanzanians.

Solve's unique model of catalyzing technology-driven solutions to global challenges is closely aligned with FinCare's mission. By joining the Solve community, we believe our team and solution will be positioned for transformative impact at scale.

FinCare's solution is innovative in several key ways:

Leveraging AI and Alternative Data: By using machine learning algorithms and drawing on alternative data sources, FinCare is able to assess the creditworthiness of individuals who lack traditional credit histories. This allows the platform to extend microloans to a population that is typically excluded from formal financial services.

Integrated Financial Management Tools: In addition to providing credit, FinCare's chatbot-based financial assistant empowers users to better understand and manage their finances through personalized guidance on budgeting, expense tracking, and debt repayment. This holistic approach to financial inclusion sets FinCare apart from traditional microlending models.

Community-Driven Design: FinCare's development process has been deeply informed by extensive co-creation workshops with potential users in target communities. This human-centered design approach ensures the solution is culturally relevant and responsive to the unique needs and priorities of underserved Tanzanians.

Scalable and Replicable Model: By leveraging emerging technologies like AI and chatbots, FinCare has built a scalable and cost-effective platform that can be replicated across different regions and populations. This could catalyze broader positive impacts by demonstrating a financially sustainable model for driving financial inclusion at scale.

Potential for Policy Influence: As a proven solution addressing a critical development challenge, FinCare's success could also influence financial inclusion policies and regulations in Tanzania and beyond. This could help create an enabling environment for other innovative fintech initiatives targeting underserved communities.

FinCare's innovative blend of AI-powered credit, personalized financial management tools, and community-centric design positions it as a transformative solution that could redefine the financial services landscape for marginalized populations in Tanzania and across Sub-Saharan Africa.

FinCare's theory of change for addressing financial exclusion in Tanzania can be summarized as follows:

Activities:

• Leveraging AI and alternative data to develop an innovative microcredit lending platform
• Integrating a chatbot-based financial assistant to provide personalized guidance on budgeting, savings, and debt management

• Increased access to small, short-term loans for individuals without traditional credit histories
• Improved financial literacy and healthier financial management behaviors among FinCare's users

• Enabled investment in small businesses and income-generating activities for FinCare's borrowers
• Enhanced financial resilience and ability to cope with unexpected expenses
• Greater financial inclusion and economic empowerment for marginalized groups, including women and rural populations

• Reduced poverty and income inequality in Tanzania, as underserved communities gain access to the financial tools needed to build economic stability and prosperity
• Broader positive ripple effects, as financially empowered individuals reinvest in their communities and contribute to overall economic growth

This theory of change is grounded in evidence from existing research on financial inclusion and the proven impacts of microcredit and financial education programs. For example, studies have shown that access to small loans can significantly improve households' ability to invest in productive assets, smooth consumption, and manage risks. Additionally, research indicates that combining credit with financial literacy training leads to greater improvements in borrowers' economic outcomes compared to credit alone.

By combining these well-established approaches in an innovative, technology-driven platform, FinCare is positioned to drive meaningful and lasting change for marginalized Tanzanians.

FinCare's primary impact goal is to increase financial inclusion and economic empowerment for underserved individuals and communities in Tanzania. Specifically, we aim to:

• Expand access to affordable credit for 1 million Tanzanians who currently lack access to formal financial services by 2030.
• Improve the financial literacy and management capabilities of 500,000 FinCare users, enabling them to make more informed financial decisions and build long-term wealth and resilience.
• Catalyze the growth of 100,000 micro and small enterprises (MSEs) owned by FinCare's borrowers, contributing to job creation and income generation in marginalized communities.
• Achieve a gender-balanced portfolio, with at least 50% of FinCare's borrowers being women, to promote women's economic empowerment.

To measure progress towards these goals, FinCare is tracking the following key performance indicators:

• Number of active borrowers
• Percentage of borrowers who are women
• Average loan size and repayment rates
• Improvement in borrowers' financial knowledge and behaviors (measured through pre- and post-intervention surveys)
• Growth in revenue and employment for MSEs financed through FinCare
• User satisfaction and feedback (collected through regular customer surveys)

FinCare also plans to periodically conduct in-depth impact evaluations, in partnership with local research institutions, to assess the long-term socioeconomic outcomes and ripple effects experienced by our target communities.

By closely monitoring these quantitative and qualitative metrics, FinCare can continually refine its services and strategies to maximize its impact on financial inclusion and economic empowerment in Tanzania.

At the core of FinCare's solution is an innovative AI-powered microcredit lending platform that leverages alternative data sources to assess the creditworthiness of individuals who lack traditional financial histories.

The key technology components that power this platform include:

Machine Learning Credit Assessment: FinCare has developed proprietary ML algorithms that analyze a wide array of alternative data points, such as mobile money transaction records, utility bill payments, and even social media activity, to generate credit risk profiles for prospective borrowers. This allows the platform to accurately evaluate creditworthiness without relying on conventional credit scores.

Automated Loan Origination: FinCare's AI-driven loan application and approval process is fully digitized, enabling the platform to quickly and efficiently disburse small, short-term loans to qualified individuals. This streamlined workflow allows FinCare to reach a larger number of underserved borrowers in a cost-effective manner.

Intelligent Chatbot Financial Assistant: To complement its microcredit offerings, FinCare has also developed an AI-powered chatbot that provides personalized financial guidance and support to its users. Leveraging natural language processing and conversational AI, the chatbot can have contextual dialogues with users to help them manage their budgets, track expenses, and make informed financial decisions.

By integrating these cutting-edge technologies, FinCare has created a holistic financial inclusion solution that dramatically expands access to credit, while also empowering marginalized individuals to develop stronger financial capabilities and resilience.

Importantly, FinCare has designed its technology stack with a focus on scalability, security, and user privacy - ensuring the solution can be responsibly scaled to benefit more underserved communities across Tanzania and beyond.

The FinCare solution team consists of 8 members in total:

Full-time staff: 5
- Costantine Edward, CEO and Co-founder
- Asha Mwakisupe, Head of Financial Inclusion
- Elias Mshana, Chief Data Scientist
- Neema Kilonzo, Director of Human-Centered Design
- Amani Nyange, Product Manager

Part-time staff: 3
- Halima Kassim, Financial Analyst (2 days per week)
- Juma Suleiman, Community Engagement Lead (3 days per week) 
- Fatuma Mfinanga, UI/UX Designer (2 days per week)

This diverse team brings together expertise in fintech, data science, design, financial inclusion, and community engagement - all of which are critical to the successful development and delivery of the FinCare solution.

FinCare has been working on its financial inclusion solution for 16 months. The concept and development started in early 2023, when the founding team came together to address the challenge of financial exclusion in Tanzania. Over the past year and a half, the team has researched user needs, designed the AI-powered lending platform and chatbot, and completed a successful pilot. This has enabled FinCare to refine the solution and prepare for broader scale-up and impact.

Diversity, equity, and inclusion are core values that are deeply embedded in FinCare's organizational culture and hiring practices. We believe that building a diverse and inclusive team is crucial not only for fostering innovation, but also for ensuring that our solution remains responsive to the unique needs and perspectives of the marginalized communities we serve.

In terms of our current team composition, we strive for gender parity, with 3 out of our 5 full-time staff being women. Our leadership team is also intentionally diverse, comprising individuals from a range of educational, professional, and cultural backgrounds. This diversity of lived experiences and expertise allows us to better understand the nuanced challenges faced by our target users and develop more holistic, impactful solutions.

To maintain and further strengthen this commitment to diversity, we have implemented the following practices:

1. Inclusive hiring: Our job postings emphasize FinCare's commitment to diversity and inclusion, and we actively recruit from a wide range of channels to reach underrepresented applicants.

2. Equitable compensation and advancement: We ensure that all team members receive fair and competitive compensation, and have clear pathways for professional development and career growth within the organization.

3. Supportive work environment: FinCare provides flexible work arrangements, mental health support, and other benefits to foster a welcoming and inclusive work culture that caters to the diverse needs of our team.

4. Continuous learning: We regularly engage in training and workshops to deepen our collective understanding of diversity, equity, and inclusion, and identify opportunities to further strengthen these practices.

By embedding these principles across all aspects of our operations, FinCare aims to not only build a diverse and high-performing team, but also serve as a model for how inclusive and equitable practices can drive meaningful social impact.

FinCare's business model generates revenue primarily through the interest and fees charged on its microcredit offerings.

Specifically, FinCare charges an average annual interest rate of 18% on its loans, which typically range from $50 to $500 in size and have repayment periods of 6-12 months. In addition, FinCare collects a one-time loan origination fee of 3-5% of the total loan amount.

This revenue model allows FinCare to cover its operational costs, such as staffing, technology infrastructure, and customer support, while also reinvesting into the continuous improvement and expansion of the platform. 

In the future, FinCare also plans to explore additional revenue streams, such as offering premium financial management services and leveraging anonymized customer data insights to provide customized solutions for other stakeholders like policymakers and financial institutions.

By striking this balance between financial sustainability and social impact, FinCare aims to create a scalable and replicable model for achieving meaningful financial inclusion and economic empowerment in Tanzania and potentially other underserved regions.

FinCare's plan for achieving long-term financial sustainability involves a multi-pronged revenue model that combines interest and fees from its microcredit offerings, as well as strategic partnerships and grant funding.

Microcredit Revenue: As mentioned earlier, FinCare charges an average annual interest rate of 18% on its loans, along with a 3-5% loan origination fee. This revenue stream is expected to grow as the organization scales its lending operations and expands its customer base.

To date, FinCare's pilot program in the Mwanza region has already generated over $15,000 in interest and fee-based revenue from the 132 loans disbursed, with a healthy repayment rate of 92%.

Grants and Partnerships: In addition to its core lending activities, FinCare is actively pursuing grant funding and strategic partnerships to support its continued growth and impact.

In 2023, FinCare received a $21,000 grant from the Saraha Ventures to support the development of its AI-powered credit assessment algorithms and chatbot-based financial assistant. 

By combining these revenue streams, FinCare is confident in its ability to achieve financial sustainability and scale its impact across Tanzania in the coming years. The organization's early success in its pilot program and ability to secure grant funding further demonstrate the viability of its business model.