Carbon, one of the leading lights in the nation’s Fintech industry, recently kicked off celebrations to mark its 10th anniversary, promising to transform banking experience and make banking more accessible and flexible for consumers.
The duo of Chijioke Dozie, co-founder/CEO and Ngozi Dozie, co-founder/Managing Director, all of Carbon, addressed a cross-section of the Nigerian media where they provided insights into where the FinTech company was coming from and where it is headed.
Rommy IMAH was at the press conference and captured the following in this report……
The journey to what is today known as Carbon, began 10 years ago, in 2012, to be precise, when two upwardly mobile gentlemen- Chijioke Dozie and Ngozi Dozie decided to disrupt the traditional banking ecosystem and subsequently democratize credit access in Nigeria.
This landmark disruption followed the inauguration of OneCredit in Lagos, to provide loans to salary earners only, using a paper-based application process that required supporting documentation.
Of course, prior to this innovative lending service, obtaining loans in Nigerian banks was like the proverbial camel passing through the eye of the needle. It was rigid and rigorous with very frustrating demands that were obviously made to chase away the prospective customer.
This was the situation when the duo of Chijioke and Ngozi did the unthinkable, latching on to Nigeria’s bourgeoning digital ecosystem at that time. Today, that bold but very timely disruption has phenomenally changed the face of banking in Nigeria, for the better.
Convinced by the prospects of the evolving fintech ecosystem, the company in 2015, broadened its service offering, leveraging a network of agents on the ground to get lending services in the hands of thousands of Nigerians under the OneFi brand.
Not resting on its oars, in May 2016, the company went fully digital, launching the Paylater mobile app, a fully digital consumer lending experience, available 24/7, that can get borrowed funds into a person’s account in minutes. It was the first service of its kind. Little wonder that after just two years in the market, the mobile app was downloaded by over 1 million users.
As the suite of financial services offered in the app expanded from just loans into payments, investments and personal finance management, the name ‘Paylater’ became a little limiting. Carbon was, therefore, introduced in 2019, to represent the intent of the fintech company founders, to offer the most diverse digital finance platform, anywhere.
Carbon’s mission is borne out of the belief that access to credit and quality financial services is a human right, and therefore, the fintech firm was established to empower all people with the financial access they need to pursue a life of dignity and prosperity.
“Carbon’s 10th anniversary is a testament to the fact that 10 years is remarkable for a Neo-bank! Celebrating a decade of value and trust. Carbon has been expanding possibilities for its clients and partners and empowering employees through its commendable journey,” Ngozi Dozie, Carbon’s co-founder/managing director said.
Headquartered in Lagos, Nigeria, as a global company of over 90 employees with operations in Nigeria, Ghana and Kenya, Carbon empowers individuals with access to credit, simple payments solutions, high-yield investment opportunities and easy-to-use tools for personal financial management.
Bridging The Credit Gap
Recalling why they started OneCredit (now Carbon) then, Chijioke Dozie, Co-founder/Chief Executive Officer of Carbon, said at a recent press conference to mark the 10th anniversary of the fintech company that the reason they started Carbon 10 years ago was because there was a significant gap in the Nigerian market.
“Most consumers were not gaining access to credit. We are all Nigerians. If you look at 2012, the chances of getting a loan in Nigeria were very slim. We felt there was a huge opportunity in meeting that gap. We preceded initiatives like NIMC and payment processing companies like Paystack and Flutterwave that started in 2015/2916.
“When we started in 2012, it was a sort of manual business, using agents to go door-to-door, doing manual verifications to grant loans to prospective loan seekers. Our agents had to check the physical records of customers, their physical KYC, their data, their employment record, etc. Luckily for us, a couple of things happened in Nigeria. First, the Central Bank introduced Bank Verification Number (BVN) which allowed us to verify KYC remotely, so we don’t need to be physically present to do this.
“Secondly, with the Fintech ecosystem coming to the fore in 2015/2016, we saw the arrivals of payment platforms like Paystack, Flutterwave and other payment processing companies, that enabled us to take payments remotely via debit cards. Prior to that, we had to use cheques,” he said.
Chijioke stated that Carbon was a beneficiary of some of the advancements that have happened in the Nigerian ecosystem, noting that it leveraged on that to fully digitize in 2016/2017 with the launch of Paylater, which was the first digital lending app in Nigeria, where a customer could get anything from N10,000 to N200,000 24/7.
Ngozi Dozie, Carbon’s co-founder/managing director explained that over the years, what they have tried in Carbon is to be innovative in all that they do and push the ecosystem forward, stating that the company is still recognised as the first digital lender in Nigeria.
“We are the first to give customers free credit reports. For customers, today, whether you take a loan or do a transaction with us, you can go to the app and check your credit report from the licensed Credit Bureaus. We are the first Fintech in Nigeria if not the continent, to get a credit rating from GCR.
“Our idea for that was because we believed that banking is about trust. We want to make sure that our customers trust us in the way we trust them, when we give them secured loans within a space of five minutes, without meeting them physically. And recently, we were the first to give free bank accounts where bill payments are free as opposed to the typical charge of N100. Buying airtime is free on our app.
“And we have pressed this forward with our latest offer, which is our final Paylater product, where you can buy products and spread payment between three to six months without paying interest rates. The goal of this is to provide customers value in a convenient manner at the lowest cost possible. That’s what drives us, and that’s what you should expect to see from us, pushing the boundaries where customers are getting values every day,” Ngozi said.
Making Finance More Accessible
Ten years is not 10 days! And for a company to successfully operate for a decade in such a harsh business environment as Nigeria’s, such a company deserves plaudits. Just a few months after changing its brand name to Carbon, and expanding to Kenya, the fintech company won the award for the Best Fintech Solution in Africa.
But beyond public recognition, Carbon’s greatest achievement lies in making finance more accessible to the people. This was aptly captured by the Chief Executive Officer, Chijioke Dozie who noted that “10 years ago, it was difficult to get a loan at the touch of a button. What we have done is that we have shown Nigerian financial institutions that Nigerians are creditworthy. The fact that we have been lending for 10 years shows that Nigerians do pay back if there are good credit processes in place. And that is something that stands us out.”
“Before we started Carbon, we started a debt collection business, and we collected for about five banks. Dealing with the Nigerian data, we realized that a lot of people wanted to pay but the banks had not set up where they could easily repay their loans when they were in delinquency. So, I think the ease of how people get money today, was pioneered by us. It’s one of our legacies, we made this possible. We’ve shown Nigerian financial institutions, especially the banks that Nigerians are trustworthy.
“We just felt that a situation where banks will take your money, take your salary, keep it without giving you a basic loan because they do not trust you, was unacceptable. When Carbon started as a digital bank, we were actually giving loans to people who were not banking with us. And I think that’s our legacy,” he further stated.
The Challenge of Loan Sharks
Digital loan operators otherwise known as loan sharks have latched on to the challenges of rising unemployment, inflation and cost of living bedeviling the Nigerian nation to target some of the most vulnerable in the country through illegal practices, no thanks to the tough loan conditions imposed by commercial banks on loan seekers.
The unconventional loan recovery tactics deployed against defaulting borrowers by these ‘unprofessional’ online lenders notwithstanding, the fact that they disburse loans in a matter of minutes has made them attractive to thousands of borrowers thus making the loan sharks thrive at the expense of licensed digital lenders.
Ngozi believes that the best way to separate the loan sharks from genuine lenders is through regulation, noting that there are laws in place being pushed by the Central Bank of Nigeria (CBN) and lately, the Federal Competition and Consumer Protection Commission (FCCPC).
According to him, “The enforcement of these laws will go a long way in putting a check on all the abuses. But more importantly is the fact that this is a demand and supply problem The fact that these loan sharks are thriving in getting more customers, who despite the presence of the likes of Carbon and similar competitors with much better interest rates, respect for their privacy and all of that, shows that something needs to be done.
“The truth is that the real solution to this is that the genuine operators, the real ones that work with international best standard, should do more. The reason is that if someone sees these loan sharks with their ridiculous and outrageous interest rates, and still goes to take a loan from them, it means we are not doing enough to woo the customer to embrace the services of the real and licensed alternatives.”
Between Carbon And Its Competition
It is a common belief that banking is about trust. It is indeed this trust that Carbon has been pushing all through the years, providing its customers with a convenient platform and a fair interest rate to do business with it. Carbon’s goal is that for every product it has if customers have the perfect information, they will choose that Carbon product.
“We want to distinguish ourselves by being customer-centric, and that’s a long journey. We are working on this seriously and passionately. Ultimately, what you see is banking institutions copying each other. We distinguish ourselves from the rest by the way we deliver our products, and how close we are to our customers.
“One of the things we focus on is that before we launch any product, we actually take time to engage our customers, introduce them to the new product and ask them if it’s the right product for them. We’ve been customer-centric, and it’s a journey we are on. We are going to focus more and more on that and making sure that we are targeting the right customers that we want as well as making sure that our products suit the customers that we have,” Chijioke said.
“Looking at what we have now, I don’t think there is any bank that offers the kind of service we offer now. Every month in Carbon, any customer that has a current account balance with us, will get an interest rate. There is no management fee, there is no fee for anything. Whereas in other banks, customers are getting debit at the end of the month, every customer in Carbon is getting credit.
“There is no bank right now that is giving you 1% cash back on all debit card payments. In Carbon, if you spend one million naira on your card, you get 1% cashback. There is no bank in the country right now that allows you to go to the restaurant, use a PoS and spread payment for 6 weeks from your app without anybody knowing what you are doing. There are so many things that we are already miles ahead of our current banking competitors, and yet we are going to do more,” Ngozi added.
The founders said Carbon is keeping ahead of its competition through pure innovation, trying to identify what the customer wants and doing that, moving quicker and doing a lot more data analytics. “When we started, people said Nigerians will never pay back, we proved them wrong. This is because we are constantly pushing to bridge the barrier.
“Banking is in our genes; we know how the other side works and thinks because we’ve been there before. We are insiders but revolutionaries. We are going to turn this thing upside down, making the customer be at the front and centre,” Ngozi further stated.
Yet, the company’s “buy now, pay later” model is seen as another major value proposition that has kept Carbon ahead of its competition. With the ‘buy now, pay later’ model, customers are allowed to spread payment over time based on their convenience when they shop for items using Carbon.
The Future Is Bright
Both Chijioke and Ngozi are looking at the future of Carbon with great expectations because they have put a lot in place to make the FinTech company a leading brand in the continent of Africa. And because innovation is the driving force of the exceptional services being rendered by Carbon, these expectations would no doubt turn into reality in the very near future.
The founders believe that to actualize the expectations of the future, the customer continues to take the prime position in the scheme of things at Carbon. “We will continue to satisfy the customer. We want to control and remove costs to add value to customers. Our desire is to ensure we reach the goal we set for ourselves when we started,” Ngozi said.
“To achieve this, a lot of things must be in place, and we’re still on that journey. The vision for us is to make finance friction-free and to make it accessible to everyone. And so that’s really what we’re going to be doing over the next 10 years. The next 10 years are to reach that goal.
“We are very pleased with what we have achieved today. It’s been an exciting journey even though we’ve had our ups and downs. We are very optimistic about the Nigerian Fintech ecosystem and the economy in general,” Chijioke concluded.