“The level of demand we have seen for our product is overwhelming.”, commented CEO Matt Flannery. “Business owners love borrowing through Branch as we are responsive to their requirement for credit that is convenient, reliable and super fast.”
Branch works simply. Applicants agree to share their phone data such as handset details and M-Pesa transaction logs with the company as they request a loan within the app. A proprietary algorithm then analyses over 2000 markers in the data that correlate with good repayment behavior and builds a personal credit profile that is used to assess applications and create loan offers. This means that Branch can do away with traditionally used lending requirements such as paperwork and collateral so as to credit customers’ mobile wallets in mere minutes.
The firm has today launched a revamped version of its Android application, which features a complete design overhaul as well as new functionality that further personalises the loan offers applicants receive allowing borrowers to be able to choose between multiple loan offers that reward shorter schedules and on-time repayment with lower interest rates and faster increases in loan limits.
Branch offers loan amounts ranging from KSh1,000 to KSh50,000. Customers build their credit limit as they continue to take out loans and repay on time. On average, each Branch customer has taken out 5 loans each. Repayment terms range from 4 weeks to 6 months, with fees of 6-16% per loan, which decrease as customers move up the loan ladder.
Branch is currently available for download in the Google Play Store in Kenya and Tanzania and is really simple. It’s like a bank branch in your pocket, only much faster! Users just download the app from the Google Play Store, login with their Facebook account, and they get a loan. Branch has — a machine learning algorithm — which analyses data from a user’s phone, Facebook, and other sources to determine how much to lend to them. Branch will deposit the funds in their mobile money account in a matter of minutes.
As users prove themselves, loan sizes go up, loan length goes down, and APR goes down as well. Branch’s current fees range from 6% to 16% on loans from 3 weeks to 1 year in length. Branch’s default rate has dropped from 25% to under 5% and the firm says it has disbursed millions of USD in loans and is growing 50% month-over-month.
In March, Branch has raised a Series A equity funding round of $9.2 million led by Andreessen Horowitz (a16z), Khosla Impact and Formation 8 also participated in the Series A round.
Get the app and see how much you can borrow!