I recently attended the IFC’s Global SME Finance Forum in Madrid, supporting our technology partner AMP Credit Technologies. Tasked by the G20 Global Partnership for Financial Inclusion, with an emphasis on emerging markets, through the Forum the IFC works to expand access to finance for small and medium businesses, bringing together “C suite” executives from major financial institutions, technology and data firms and development organisations. Attendance from UK firms was light.
So why is this relevant? For some businesses like AMP the Forum has driven new client relationships – while at the AMP exhibitor stand I discussed opportunities with significant financial institutions in the CEE, the Middle East and other geographies. For other delegates, it’s about sharing thought leadership and defining new opportunities. The challenges in emerging markets may be different and require creative thought but can benefit from advances made by firms in more established markets; as well as in some cases inspiring new ways of doing business in those more established markets.
Fintech played large and innovative business models were presented – for example, UK firm Jumo showcased their work in providing usage-based asset finance for taxi drivers in Kenya. Euler Hermes nodded towards a new approach to SME insurance products driven by their innovation hub in Paris. BBVA shared their vision that digital customer journeys should be 100% DIY. The problems of thin-file or no-file credit information was discussed by participants, requiring behavioural data from other payment sources, additional processes such as on-line psychometric interviewing and a focus on usage-related variable payment structures.
For those companies with the international flexibility to deploy new solutions in emerging markets, in some cases to serve major financial institutions with a large customer base, the Global SME Forum provides an interesting channel to explore further.