projecteverest

[Idea/Concept Not Complete]: SoCon Fiji - Can we utilise a training platform to reduce risk? - July 2018

by
Rose Martin
Rose Martin | 9 months ago | in Fiji - Social Consulting

What is the end goal for SoCon Fiji? A digital platform where people can gain access to finance. But, how can we reduce our risk of providing loans, by ensuring that consumers have the ability to pay back their liabilities?

 

There have been a number of ideas floated for reducing risk. These include, but are not limited to;

  1. Data collection (e.g. social media data, phone and telecom data, third-party data etc.)

  2. Training platform (education)

  3. Endorsement/referrals/group lending (see Will’s post https://projecteverest.crowdicity.com/post/555477)

  4. Past financial data (if any)

 

Training is one way to reduce the risk of customers defaulting on loans. By providing them access to the correct information, we may be able to guarantee that customers have correct financial and accounting documents, for example, allowing us to more accurately measure their risk of default. This COULD come in many forms; one being in line with Will’s idea of a ‘reputation points’ system, whereby people can gain extra ‘reputation points’ by participating in a training session and providing us with valid information.

 

But in what form does this come? And what does it look like?

 

Many of you will be familiar with SoCon’s previous education models in Fiji; which were a set of educational workshops that looked at all areas of business, from marketing, to design thinking workshops, to accounting and finance workshops. While we did prove that there was demand for these workshops and that they were well received, this model was not scalable as it was costly.

 

Our goals for the following month is to design and test a functional spec for a new training platform, and we will be looking specifically at;

  1. Testing certain features of a digital platform.

This requires us to look at testing the usability of providing workshops on a digital platform. We can do this by looking at how workshop attendees interact with different online interfaces; whether that be simply watching a training session on a video screen, or more complex tests such as seeing how they interact with different types of accounting software.

 

  1. Moving away from ‘education’, and more towards ‘training’

The way that I see the training platform being a scalable and actually beneficial to reduce risk, is to ensure that the training we are providing gives a direct output to something such as a cash flow statement, or income statement, or other piece of information that can help us to accurately measure risk. Thus, this month we will be looking at how best to use the training platform to acquire this information, rather than simply ‘educate’ on various business concepts.

 

Let me know if you want me to elaborate on any of these things, and please share your thoughts!

 

Rose

 

edited on 5th September 2018, 23:09 by Justin Hakeem

Kurt Michl 8 months ago

Hi Rose,

I appreciate that my input will likely be outdated, but it may add a new perspective.
I agree that education is paramount for reducing risk, but also from a moral point of view. I think it would be unethical to provide debt to individuals who may not have a car understanding of what is entailed and what is required.

In Malawi we have encountered the same sort of mental blocks as far as education goes. We have had a few ideas to possibly get around this.

The concept of education as being an indicator of credit worthiness is very interesting. We were thinking from a startup stance, it could be a requirement. This could take the form of taking a compulsory education module to be eligible for a loan.

We also considered setting up education modules with a test at the end as a requirement for credit-worthiness. We could then collect data on how the individuals repaid the loans, and correlate that data with the test scores that they get. Longer term this could create a credit-model where the test score would determine riskiness, and thus what terms one would be eligible for on a loan.

Have a look at these posts from my fellow trekkers if you've found this interesting :)

https://projecteverest.crowdicity.com/post/575822

https://projecteverest.crowdicity.com/post/576716

Reply 1

Rose Martin 8 months ago

Thank you Kurt! I completely agree. The idea for this training platform at the moment is that it will either be compulsory for a loan, or that, as you say, completing some kind of training will gain them a higher credit-score.

This month we've focused more on providing training and modules that will give us a direct output to something that may help us to better assess the risk of a client, such as relevant financial statements or financial information. I will get one of my trekkers to make a post on these experiments in the coming days so you can have a read!

Reply 2

Kurt Michl 8 months ago

I'll be very interested to have a look :)
Thanks Rose

Reply 0

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