Based on a Nigerian
community savings scheme, London-based fintech start-up Neyber is helping put
loan sharks out of business
When Martin Ijaha’s mother worked as a nurse,
she and her colleagues would band together to save money in a community
tradition called Esusu in Nigeria.
Each month the nurses would chip in a little
of their salaries to an ever-growing pot, providing them with an effectively
interest free loan service available whenever needed to cover unexpected
Fast forward some 20 years and this was the
inspiration behind Ijaha’s fintech start-up Neyber, which seeks to provide
allow employees access to finance with repayments deducted directly from the
salaries paid by their employers.
Neyber CEO Ijaha, a former technologist and
investment banker with Goldman Sachs in London, launched the company in 2015
with two other former bankers, Monica Kalia, also from Goldman, and Ezechi
Britton, formerly of Credit Suisse.
BORROWING AGAINST FUTURE INCOME
Only three years later, and business is
booming. The company now counts more than 50 staff, works with over 80
employers and in late 2017 received £100m in investment from Goldman Sachs.
The innovation inherent in Neyber comes from
the fact the company agrees the deal with employers allowing employees to
borrow against future salaries with loan repayments deducted directly from the
employer. This lowers the lender’s risk and helps enable Neyber to offer more
attractive interest rates.
Ijaha, who grew up in London and studied
Computer Science at University College London, first trialled the concept at
his old school, St Charles Sixth Form College, in West London before signing a
deal with Police Mutual, the organisation providing financial services to UK
police officers and support staff.
SOLVING A REAL CONSUMER PROBLEM
Ijaha is a rare African presence in the UK’s
financial technology space, according to Nzube Ufodike, an entrepreneur and
advisor to early stage technology start ups, and another prominent African
diasporan in the UK’s financial technology sector.
“Neyber is exciting for me, because it solves
a real consumer problem – one of needing cash before payday and having not many
alternatives,” he said.
“Bank loans may not be available without
collateral – and payday loan sharks can gouge you. If you can get your employer
to give you a sort of advance payment in the form of a loan and you gradually
pay it off, then it sounds reasonable. I’m also excited because it’s based on
an African model.”