NewTech Friday: Microfinance Pro – Empowering financial inclusion in Africa

Digital Reinvention
08/03/2024 Interview
profile picture of Lionel Aluka

Lionel Aluka

Microfinance Pro

Founder and CEO

Microfinance Pro is an award-winning SaaS solution that was selected for the CATAPULT: Inclusion Africa program in 2023. Lionel Aluka, Founder and CEO of the Togo-based startup, shares the compelling story behind their mission to democratize finance and foster sustainable development in underserved communities, and outlines ambitious plans for the future.

What led to the creation of Microfinance Pro?

The director of a microfinance institution in Togo requested that I develop a solution to tackle a serious problem of employee theft, after losing over 30% of their clients’ deposits in one year. The institution had 10,000+ customers but could not afford reliable software to manage their accounts. It would send field agents to collect daily deposits, ‘tontine’, from them. How else could it help its customers save money when so many of them do not have a smartphone or internet access? As the director was explaining to me that their clients did not have a digital banking app, an older lady barged into his office begging to be reimbursed any portion of $400… her entire life savings that had vanished without a trace. She had many paper receipts proving she had given all this money to field agents.

After setting up in-person meetings with over 30 microfinance institutions’ executive management in Togo, Burkina Faso, Benin and Ghana, we confirmed that the same technology and theft problems had played a big role in causing thousands of institutions to suspend ‘tontine’ operations or shut down altogether in the last six years. Further research had us shocked to learn that 83% of people in Benin, Burkina Faso, Côte d’Ivoire, Guinea-Bissau, Mali, Niger, Senegal and Togo (the WAEMU Zone) are underbanked or unbanked, and thus do not have access to banking services. This led us to create digital solutions suitable for these countries’ practices and challenges, while also focusing on financial inclusion.

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