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Branch.co is launching in Kenya (with m-pesa as a data input) and will analyzes details like: how much a user spends on a typical day, whether or not they have loans from other lenders, how much money they have deposited in their m-pesa accounts, and who their friends and business associates are in order to lend up to $20.
In many ways, Branch operates like a bank in the cloud, one that is accessible not through local “branch” offices, but through a user’s smartphone. It provides small amounts of credit–up to $20–to Android users in Africa, specifically Kenya today, but doesn’t take deposits. Branch is able to make decisions about creditworthiness without ever meeting would-be borrowers in person as many microfinance institutions must do before making loans. Here’s how it works. A user downloads the Branch mobile app which asks them for access to some of the social and transactional history already stored on their phones thanks to their use of m-pesa and Facebook FB -0.60%, among other apps.
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