Afrijula – A Digital Tool Empowering Entrepreneurs in The Gambia
Awa Jagne, UNCDF
Access to finance is quite crucial for young entrepreneurs, especially at the inception or build phase of their businesses. Unfortunately, the lack of financial knowledge and exposure are still two of the main challenges affecting young entrepreneurs in The Gambia. In addition, the absence of financial records or collateral makes this segment a high risk for Financial Services Providers (FSPs). In The Gambia, micro, small, and medium enterprises (MSMEs) account for 10 percent of businesses, with approximately 77 percent of them being unregistered. This, therefore, leaves them outside the financial inclusion frontier despite the national target of achieving a 70 percent inclusion rate by 2025 according to the National Financial Inclusion Strategy (NFIS).
New entrepreneurs often perceive FSPs as institutions only serving a certain class, which erodes their trust and discourages them to seek more knowledge about financial systems and their potential benefits for their businesses. Moreover, lack of financial history, business records or collateral acts as barriers to traditional financial institutions’ requirements that are put in place to mitigate risk.
To address these challenges, UNCDF partnered with Insist Global to develop Afrijula, an online business platform. Afrijula enables MSMEs to record and manage their financial transactions while simultaneously building a financial record. This enables FSPs to evaluate the financial health of these entrepreneurs, granting them access to financial products and services, with a particular focus on youth and women groups.
Afrijula was designed to leapfrog entrepreneurs into the opportunities created by the digital era. However, the platform alone is not sufficient, considering that most of them have never had access to digital and financial services. To address this challenge, Insist Global collaborated with UNCDF to develop digital and financial learning modules. These modules were then utilized to conduct countrywide training sessions. One of the main objectives was to encourage entrepreneurs to adopt and utilize the platform by demonstrating the benefits of maintaining digital financial records.
Throughout the process of product design and development, providing access to finance was the primary objective of the project. The first step was understanding the manual application processes to access credit and finding ways to overcome the administrative hurdles. In collaboration with two Microfinance institutions, Bayba and Reliance, an online application and approval tool was developed and integrated into the Afrijula platform. The Afrijula banking tool currently allows entrepreneurs to apply for a loan online by granting, the two microfinance institutions, access to their online profiles and financial records as a substitute for providing physical documentation or collateral. This online loan process reduces the manual credit application process by 80%.
To date, Afrijula has registered around 8,000 MSMEs out of the 115,000 registered businesses in The Gambia. The partnership between UNCDF, Insist Global, Reliance and Bayba was made possible under the Job Skills and Finance (JSF) programme funded by the European Union. Through such collaborations and innovative digital solutions, the programme aims to contribute to the economic, social and security stabilization of the country during its democratic transition by facilitating social inclusion and employment of youth and women, with a specific emphasis on promoting gender equality and addressing climate change.