By Steve Umidha
After one-and-a half years of what seemed like ‘tasting the Kenyan waters,’ Mauritius-based Cim Financial Services, operating locally as Cim Finance Kenya, is gearing up for something of a riposte tour with keen focus on 2020.
The company operates and manages a unique mobile lending App, Aspira.
Earlier in October, the digital lender which formally launched in 2018, embarked on a rebranding exercise as part of what its Managing Director Yoeal Haile says was the company’s deliberate growth strategy for the Kenyan market, “to become the leader in the digital hire purchase space.”
“We formally launched in May 2018 but we spent 2017 setting up the business, building our tech platform, building our retail partnerships, conducting market research to understand the challenge that we were trying to solve and how do we design the product around it,” opens up Yoeal during an exclusive interview with Financial Fortune’s Editorial Director Steve Umidha.
The platform is different from other mobile loan apps already in the market, and does not offer clients cash, but channels the money directly to retailers to help clients acquire products they want. After approval, one will have to get to a partner store, and, for a first-time user, pay 30 percent of the price of the item. Thereafter, the person is required to pay four percent simple interest per month on the balance.
To use it, one has to download Aspira App on either Apple Store or Google Store and provides between Sh20, 000 and Sh350, 000 credit facility.
The company started out with initial five (5) retailers during its launch in Nairobi and that number has since swollen to over seventy (70) new merchants on board to date with about 150 point of sales or places in Nairobi and Mombasa where Aspira clients are able to access credit cards and related financial services.
“We have seen an impressive growth in monthly sales since we started and a growing interest in the market for this sort of financing,” reveals Yoeal who previously worked as Chief Strategy officer at the African Leadership Group, a pan-African conglomerate focused on leadership development across the continent – who earlier in his career, worked in equity derivatives trading for Merrill Lynch at their Hong Kong and New York.
While the immediate plans are to increase monthly sales and yearly turnover respectively, the 33-year old who helped launch Aspira in conjunction with Cim Financial Services Ltd as a founding Managing Director, says there is potential to expand outside Nairobi and Mombasa, although the long-term aim is to keep everything in the capital.
“In the course of next year we intend to enter Nakuru and Eldoret and we have already piloted for the two cities,” says Yoeal who played a pivotal role in spearheading the building of the business and overseeing product development as well as other operations at Aspira. He is however, coy about divulging into the investment budget for such expansion plans that also targets Kisumu – all slated for 2020.
The company ventured into Mombasa in August this year with plans already in motion to expand its retailer base at the coastal region.
Aspira is a subsidiary of Cim Finance, the largest non-bank financial institution in Mauritius, which set up Cim Finance Kenya to bring affordable product financing to Kenya. Cim Finance has more than 250,000 active clients and lends Sh12 billion annually via product financing in Mauritius.
Yoeal now hopes to grow the business in Kenya over the next few years in a market he estimates Aspira has the potential to seize in excess of Sh30billion in annual revenues judging by the firm’s monthly target of Sh50million monthly.
“We want to be a responsible lender. Everything is tied to an asset which we believe helps manage and mitigate the risks,” he says, adding that the company has already gone beyond breaking even in terms of both customers being served and monthly sales with Return on Investments (RoIs) already being felt.
Of Eritrean descent, Haile is the son of refugees who migrated to the United States in the 70s, and spent his early years growing up in a lower-middle-income environment in New York where he learnt at an early age how crucial financing was in gaining access to amenities such as furniture and household appliances in the US.
Today, the company has 60 staff, 58 of whom are Kenyans with an average age of 25 years. “I see a group of young and hungry individuals who want to learn and improve,” he says.
Since then, Aspira has evolved and as a result he tells me that, it was time for the company to refresh its logo and brand colours to ‘reflect a more modern look and feel in alignment with the company’s mission to deliver on quality, performance and service support across its offerings.’
“Our customers are at the heart of how we do business and we want to help them achieve their aspirations sooner rather than later. Our aspiration is to provide customers with and affordable way of realizing their dreams, accessing various products they need, through our competitive financing solutions,” he says – a man who began his career as an Analyst at Merrill Lynch in 2008, just before its merger with Bank of America.
Despite the turmoil caused by the merger that eventually rendered over 30 per cent of its workforce redundant, Haile survived the chop, rising through the ranks and became an Associate at the firm two years later.
His sheer hard work and determination saw him relocated to the firm’s Hong Kong offices with the Hong Kong exposure and propelling him to immense potential of Emerging Markets. Haile eventually left Hong Kong to complete his MBA at The Wharton School at the University of Pennsylvania.
Under its campaign christened Lipa Baadaye, loosely translated as Pay Later in Swahili, Aspira aims to empower its customers with the knowledge and skills to take control of their finances through strategic borrowing to facilitate their lifestyles.
The company is also not ruling out possibility of venturing into Sharia’h complaint products and services, but remains a long shot for the budding company. Other potential areas include financing education, leasing among other sprouting opportunities as it seeks to diversify its products and services.
Despite the growing number of Fintech firms flooding the Kenyan market, Yoeal believes this also poses a huge risk for the market owing to the absence of stringent regulations and laws for non-banks operating in the financial services space.
“Those are the things this space I think needs especially really with poor regulations,” he says, adding that this will go a long way in promoting responsible lending among Kenyan borrowers.
Statistics from 2019 FinAccess report, shows that about 90 percent of Kenyans have access to both formal and informal financial services.
With the rebrand of Aspira, the firm believes that the gap between urban and rural dwellers will further be bridged as more people will have access to credit which allows them to purchase merchandise across the country, at an affordable rate.
“I see an industry that will require a lot of innovation in the coming years,” he concludes.