MoneyMart Deploys Biometrics to enhance customer security in Micro-lending
As a digital focused Microfinance institution (MFI) in Zimbabwe, we join the world in celebrating the 20th annual Cybersecurity Awareness Month this October. The theme for Cybersecurity Awareness Month this year is #SecureOurWorld.
Biometrics by definition is the use of automated recognition of individuals or customers by means of unique physical characteristics, typically for the purposes of security. It is the use of physical characteristics, such as fingerprints, iris, or face, to identify and verify customers. From our experience in this industry, we realised that the use of know your customer, beside delaying the onboarding process it also creates challenges when we want to disburse borrowed funds. The biggest question being how do we verify that the person that we are giving the cash is exactly the same person that applied. It’s the lowest form of identity theft used by scammers and fraudsters.
As MoneyMart finance we have come to a conclusion that biometrics plays an important role in our business, which is the provision of nano, micro, small loans, savings, insurance, and other financial services to our customers at the bottom of the pyramid with women and youth as our chosen priority.
As MoneyMart we are convinced that biometrics will help in changing the way we do business and the way we financially include the previously excluded. Below are some of the positives we have seen from our deployment of biometric point of sale machines at all our branches in the market.
Improved access and convenience for MoneyMart customers.
Over the years MoneyMart has grown in leaps and bounds as such we are opening branches across all main towns; cities and we are now represented in most of growth points in Zimbabwe. One of the biggest challenges that we have faced as an organisation is that we have encountered citizens who are running successful small-scale business but they still do not have formal identity documentation. This is due to many reasons including cultural and mostly religious. While this number may not be that big our mantra is we are not living anyone behind as we create wealth and changing lives. The lack of formal identity is mainly prevalent in women and girls who interestingly are the ones who are running the majority of small businesses in Zimbabwe, with the 2022 FinScope survey attributing them to 60%; and this is evident in our database as well. Biometrics has enabled us to open accounts for these women, now they have access to credit with just their fingerprints, without the need for signatures, passwords, or cards. We are not ending there, the goal is for them to have access to a transacting account that can transact internationally and create a bankable credit profile for them.
Enhance security and efficiency in our operations
Biometrics have helped us in so many ways by reducing the risk of fraud, identity theft, multiple borrowing, or loan default. As it stands, we do not disburse a loan to a customer before biometric verification that we are disbursing to the rightful customer. Biometrics have helped us to verify the identity of our customers. In the long run it will help us to track our customers’ repayment history across different branches thus our accounts will not be branch based.
Related to efficiency biometric technology will help us reduce costs associated with identity verification, fraud prevention, and administrative processes. By digitizing and automating these activities, MoneyMart will operate more efficiently and allocate resources more effectively.
Promote financial inclusion and empowerment of our customers,
As mentioned above, women who may have faced barriers to obtaining formal identification or accessing financial services. Biometrics has helped us to reach out to these underserved segments of the population and provide them with secure and affordable financial products. Some of the women are semi-illiterate and find it difficult to come up with a signature that they reproduce every now and then. Our biometric technology is improving credit access while also increasing the security and efficiency of our systems
Social grants and benefits
The government and NGOs who provide social grants did not have a way to verify that the funds they disburse reach and are used by the intended beneficiaries. As MoneyMart we have experiences instances where husbands bring their wives’ phones (who are the rightful beneficiaries) and cash out social grants and half the time the funds never reach the intended beneficiaries but they more often than not end up at a pub, shebeens or bar in that area. MoneyMart biometrics will ensure that this won’t happen. With biometric fingerprint technology, MoneyMart Finance is able to ensure that no one else, not even her spouse or his relatives, can take money out of her account.
While biometric technology has offered us several advantages, it is also critical that we address potential concerns related to privacy, data protection, and informed consent. As an organisation appreciate the need for robust security measures and strict adherence to data privacy regulations the responsible and ethical use of biometric data in microfinance.
Find out how we protect our customers online by referencing our digital resources and following our channels on LinkedIn, Facebook and X (formerly Twitter).
By Munyaradzi Gerald Nyakwawa
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