Faith owns a small fruit-selling business in Uganda. Like most small business owners in Uganda, Faith started her enterprise with her own income and lacks access to finance to grow beyond the few fruit stalls she owns. She doesn’t keep full financial records and lives most of her life informally and in cash, but has started using mobile money to make payments to the truck driver that delivers the fruit to the market and to receive payments from her customers. Faith, like Gimei Robert from our first blog post, lacks access to financial services that support and improve their livelihoods.

But can new ways of collecting and analysing data tell us more about the economic lives of Faith and Gimei? For example, what do the payments that Faith has made and received through mobile money tell us about her cash flow management? And what about information on what we don’t see – her informal financial engagements?

Could these insights be used to design financial services that improve the lives of Faith or Gimei? If so, what type of financial services?

Last week, these were the questions put to the teams competing in the i2i country DataHack4FI Innovation Competition in Uganda hosted in partnership with UNCDF MM4P, FSDU and Laboremus. The competition ran from 31 March to 22 April 2017 and attracted over fifty participants, comprising of seventeen teams. The final ten teams squared off at the Innovation Village in Kampala, Uganda and presented their prototypes to a panel of judges with representatives from Airtel, Stanbic, FSDU, Interswitch and Cellulant.

Presented with data from the Uganda National Small Business Survey (2013) and the recently released L-IFT Financial Diaries survey in Uganda, (2017), teams were challenged to design welfare-enhancing financial services for low revenue businesses and vulnerable segments of adults with a focus on the potential of technology to enable financial institutions to serve them.

The datasets provided important information on the financial needs of these groups, with a specific focus on SMEs. For example, most SMEs need access to finance to grow their business, but have poor record keeping of transactional information, making it difficult for credit-scoring models to evaluate their repayment potential.

The winning team, #KillerAnalytics, put forward the solution SmartCredit, which is a business intelligence and analytics engine that processes SME data to create accurate business profiles to identify financing gaps and design tailored solutions for SMEs based on their specific business scenarios. The solution leverages on data from MYAccounts™ which is a low cost mobile based tool that allows SMEs to record their basic transactions (sales, expenses, purchases, inventory etc.) in a simple, easy to use way and generates full financial reports automatically.

The team was mentored by Peter Kawumi, Innovations Specialist at FSDU, who shares his thoughts on the winning team’s solution,

“My engagements with #Killer Analytics supported their understanding of the National Small Business Survey dataset, allowing them to improve their solution to address the challenges of tracking records, getting access to formal credit that SMEs in Uganda face. Our engagements with SMEs within the Kampala area has already resulted in two new customers for the team and interest in addressing the credit linkage from two commercial banks. I have high hopes for their solution as it is addressing a real problem that SMEs face in Uganda.”

#KillerAnalytics will be heading to Kigali, Rwanda to square off against the top teams from the other eight country competitions in the Grand Finale of the DataHack4FI Innovation Competition for a chance to pitch to investors at Transform Africa. The DataHack4FI innovation competition brings together data enthusiasts and FSPs to crowdsource data-driven solutions to real-world challenges in attempts to showcase the use of data-driven decision-making by FSPs.

Richard Ndahiro, a Consultant at UNCDF MM4P who served as a judge during the initial pitches at the launch of the competition and later as a mentor, reflects on his DataHack4FI experience,

“The hackathon was a very exciting event. It proved that Uganda not only has potential developers, but more so, that they care a lot and are ready to invest their time in solving the daily livelihood challenges of the low-income household in Uganda. The solutions developed were based on household data, an indication that availability and access to data in Uganda and the region can lead to great insight into the real challenges faced by the population and inform the development of the relevant innovative solutions powered by mobile payments, in key sectors like Agriculture, Health, Energy, Water and Sanitation. UNCDF will continue to support innovative platforms such as this DataHack4FI in order to improve the livelihoods of people such as Faith and Gimei.”

While the competition is ending, we hope that DataHack4FI is only the tip of the iceberg that catalyses interest in data and analytics for financial inclusion in Uganda.

The DataHack4FI innovation competition in Uganda is hosted by Laboremus in partnership with i2i, UNCDF Mobile Money for the Poor (MM4P) and FSD Uganda (FSDU), with additional datasets provided by Low-Income Financial Transformation (L-IFT) and additional support from The Innovation Village Uganda and GLADfarm Uganda.

Kate is a Researcher for the Client Insights workstream at insight2impact.

Peter Kawumi is an Innovations Specialist at FSDU.

Richard Ndahiro is a Consultant at UNCDF MM4P.

insight2impact (i2ifacility) was funded by Bill and Melinda Gates Foundation in partnership with Mastercard Foundation. The programme was established and driven by Cenfri and Finmark Trust.