Increasing access to credit without increasing the risk of the portfolio

In September 2011, FOMIN presented a project to the donors committee that aimed to test a novel approach to evaluate the credit worthiness of micro and small entrepreneurs.  It was a tool developed by the Entrepreneurial Finance Lab, a for-profit organization created in 2010 after developing a low-cost credit screening prototype at the Harvard Center for International Development.

FOMIN’s project sought to financially support the implementation of the tool in four financial institutions in the region; our final goal was to increase access to credit for micro and small enterprises. 

In addition to providing financial support, we also studied the effectiveness of the tool. And the EFL tool did was it was set to do:  increase access to credit without increasing the risk of the portfolio. 

Since September 2011, EFL has grown its operations to more than 27 countries and has processes over US$1 billion credit decisions around the world. It constantly garners attention from major news outlets.

Recently, FICO announce a strategic partnership with EFL Global to make EFL technology available to FICO clients, unlocking economic opportunities for lenders and access to credit for more than 3 billion unbanked or underbanked people worldwide.  Talk about scale!