Bfree: Innovating Debt Collection in Africa's Digital Lending Landscape

Bfree: Innovating Debt Collection in Africa's Digital Lending Landscape

By Staff Writer, 02 March 2024

In response to the predatory tactics employed by some digital lending firms, Nigerian startup Bfree emerged in 2020 with a mission to revolutionize debt collection methods.

Buoyed by its recent fundraising triumph, securing a staggering $2.95 million in a funding round spearheaded by Capria Ventures, Bfree is poised for further expansion.

This funding round saw contributions from a consortium of investors, including Modus Africa, Axian CVC, Angaza Capital, GreenHouse Capital, Launch Africa, and a host of angel investors, catapulting the startup's total capital raised to an impressive $6.5 million.

Founded with the goal of automating and implementing ethical practices in debt recovery, Bfree seeks to mitigate the harmful repercussions of aggressive debt collection techniques, such as incessant phone calls and public humiliation of debtors.

Since its establishment, Bfree has developed a range of innovative debt recovery strategies tailored to diverse circumstances.

Among these strategies is a user-friendly self-service portal, empowering debtors to autonomously establish new repayment plans.

Additionally, the company harnesses conversational AI technology, employing chatbots and callbots to deliver more compassionate post-sales services and make informed decisions based on behavioral and financial insights.

Bfree's client base has witnessed remarkable growth, boasting partnerships with prominent financial institutions across Ghana, Kenya, and its home turf, Nigeria.

Distinguishing itself as the sole tech-enabled credit recovery entity operating on a pan-African scale, Bfree fills a void in a region where debt collectors predominantly rely on antiquated methods such as call centers.

Looking ahead, Bfree sets its sights on establishing a secondary market for loans, leveraging its substantial loan portfolio exceeding $400 million, of which it has successfully recovered 12.5%.

This envisioned secondary debt market will offer third-party investors, including hedge funds, the opportunity to acquire non-performing loans (NPLs) from banks, fostering investment diversification and financial inclusivity.

Source: Tapiwa Matthew Mutisi / Innovation Village

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