A FinTech Start-Up,Tala, Is Providing Financial Access For the Unbanked

October 18, 2021 | 2 minutes read

The FinTech Startup Tala is democratizing financial Access for the underbanked all around the world.

The Silicon Valley-based fintech startup Tala is providing financial services in emerging markets by using mobile technology and data science. 

Tala is an emerging market digital lender that gives loans between $10- $500 to small business owners and consumers. Recently, the start-up has also raised $145 million in Series E funding. The startup has proved to be quite vital. As to date, more than 2 million people have borrowed via Tala’s smartphone app providing lending, instant credit scoring, and other financial services in emerging markets.

Shivani Siroya started this FinTech start-up in 2011, and in 2014 launched the first mobile application to offer credit and collateral-free loans to consumers in Kenya. Later on, it started providing its services in the Philippines, Mexico, and more recently in India. The company has more than 6 million customers across these four markets plus the company claims to have disbursed over $2.7 billion worth of credits since its initiation.

Financial Technology, in short, fintech all around the globe is becoming common because of its universality, cost-effectiveness, and other multiple advantages. Like for small businesses the Fintech apps are extremely useful because of the easy and fast access it provides towards the cash. According to stats, nearly 56% of small and medium-sized enterprises use technology-based banking and payments services, and 46% use financing fintech services. This has also increased the demand for the development of fintech mobile apps as well as fintech software.

Fintech apps are quite efficient in comparison to traditional loaning and banking processes. The company explicates that it can approve the loan within minutes and distribute the money via mobile payment platforms. The company charges a one-time fee as low as 5% for each loan. In addition to this, the company says that more than 90% of customers repay their loan within 20 to 30 days.

According to the World Bank’s Findex Database, about 1.7 billion adults in 2017 were unbanked. And a National Retail Federation (NRF) survey found that 19% of people made their first contactless payment during the month of May in 2020 and 57% were willing to continue the services offered by fintech. These figures actually depict that fintech holds the great potential of making people part of the formal economy.