Chief Executive Officer and Founder
Location: Hong Kong, SAR
Number of employees: 50
Year founded: 2011
2207 China Insurance Group Building, 73 Connaud Road
People’s Republic of China
In emerging economies, the new middle classes typically struggle with excessively bureaucratic procedures to access bank loans for purposes such as medical expenses, home improvements, small business investments or school fees.
Meanwhile, many of the same people are highly active on social networks such as Facebook, Twitter and LinkedIn. Their behaviour on these networks provides a rich source of data about their character virtues, such as honesty and consistency.
Lenddo makes loans after using social media accounts to assess applicants’ creditworthiness, with an algorithm scoring them on their online behaviour and the strength of their connections. As in the original concept of microcredit, members of a community are able to vouch for each other’s character when they apply for a loan, and then exert social pressure for those loans to be repaid. Lenddo scores evolve constantly: when someone repays a loan on time, the demonstration of trustworthiness can improve the score of others in the person’s network.
The typical loan is for around one month’s salary, though repeat borrowers can access higher limits and lower rates. Lenddo’s default rates are typical for the microcredit sector, in the low single figures, but with lower transaction costs than are typical for the sector.
Lenddo has made tens of thousands of life-improving loans in Colombia, Mexico and the Philippines, and is targeting expansion into approximately 20 countries where analysis suggests the middle class is both healthy and under-served by existing financial services, including Indonesia, Brazil, Russia and China.