In Sierra Leone, most financial institutions in the country are concentrated in the Capital, Freetown and secondary urban areas like Kenema and Bo, leaving most people in other parts of the country cut-off from the financial system. Reasons include the high operating cost for institutions going into the rural and under-served areas of the country. Institutions have also not yet established a business case and sustainability plan for going into remote locations. Deploying innovative agent models holds a promise to overcome this challenge.

With this challenge in mind UNCDF is partnering with Orange Mobile Finance (SL) Ltd in a consortium of “Orange Money”, Mosabi and Empire Solutions. The consortium was set up to address specifically the four main challenges to financial inclusion in Sierra Leone: the lack of financial access points; the limited number of women agents; the low levels of financial literacy; the lack of access to credit. The project aims at improving the distribution of digital financial services in Sierra Leone by leveraging innovative agent models, financial literacy, and digital credit with a focus on women, youth and low-income segments.

Orange Mobile Finance SL (“Orange Money”) is the lead implementer. Mosabi is a software technology company that provides mobile e-learning, cloud data insights dashboards and APIs, and licensed learning materials. Empire Solutions is a registered microfinance institution with license to provide digital loan services. Orange Money will provide the technology, environment, and ecosystem on which all services will run to facilitate the access to the trainings and the loans.

Orange Money’s current female-to-male agent ratio is approximately 4%. At the same time, some recent research suggests that more representation of women agents could lead to higher female uptake and usage of digital financial services. This project presents an opportunity to improve gender balance in agent networks, which could support women’s empowerment within the communities.

Although there has been some work done to increase consumers’ knowledge and capacity to make informed financial choices, more needs to be done to increase the confidence and trust of customers in banks and financial institutions at large. There is still limited awareness and understanding of financial products and services, and low levels of financial competency among the population.

The lack of access to credit for entrepreneurs especially for vulnerable segment such as women, youth, and the low-income population remains a challenge in Sierra Leone. In a recent UNCDF project with the Directorate of Science, Technology, and Innovation (DSTI) to map the digital and entrepreneur ecosystem, the report noted that over 50 percent of entrepreneurs interviewed cited the lack of access and availability of affordable finance as the main challenge to the growth of their businesses. For 65 percent of the businesses, the major source of start-up capital was their personal savings. Other common sources were loans and gift from family and friends.1 These findings are consistent with the “State of Entrepreneurship 2report” in Sierra Leone that showed that 64 percent of entrepreneurs reported access to finance as the biggest obstacle.

Over the next ten months, 2,000 new agents will be recruited and trained of which 50 percent will be women. In addition, 500 inactive agents will be reactivated of which 20 percent will be women. 10,000 customers will also be offered financial and digital literacy training sessions online via the Mosabi platform. Out of this number, at least 2000 will benefit from a digital loan product that will leverage algorithms refined to suit the target segment: women, youth, and low-income population.

Stay tuned to read about the result of this project with a new type of consortium