Founder and Chief Executive Officer of Mathesis Analytics, Winston Osuchukwu, speaks withFELIX OLOYEDEon how AI-powered credit infrastructure and stronger collaboration between fintechs and banks can expand access to credit in NigeriaWhat inspired the establishment of Mathesis?The inspiration for the company was very simple. It was clear that people were unable to access credit where and when they needed it. I just figured that using freely available technology, we would be able to solve that problem and help everybody, help the banks lend more, help consumers access credit, and, importantly, help traders and merchants sell more to their customers.With the economy still recovering, how would you assess the current business environment, particularly the challenges and opportunities surrounding access to credit and business expansion?The business environment, really, if you want to look at our business, in truth, the only issue we have is the cost of things that we do not produce locally. So, in terms of everything local, we are fine. When it comes to how the economy affects clients? Well, you can see that borrowers are in some distress. So, there is usually a perceptible uptick in defaults from the borrowers that we help get loans.How do you expect fintech to transform financial inclusion in Nigeria over the next decade?I think fintechs are going to do something interesting, which is they are going to bring the banks closer to the individuals. What fintechs actually do is they help collect data that the bank currently does not hold, interpret that data, and provide it to the banks, and they now make intelligent decisions. At the end of the day, banks are very good at mobilising cheap deposits. They are also great at getting customers and depositors at scale. While fintechs are much better at iterating their processes and being quite innovative. So, both are going to come together and drive a significant improvement in services to current bank customers and open the doorway to bank a lot more of the unbanked people.What distinguishes your company from other fintech firms, and what unique solutions does it offer the market?What we do is analytics. The one thing we do is take data that our clients currently do not see as having any value in making decisions. We take all that data, we bring it together, and then we deliver it to our customers. We deliver to our customers the resources and suggestions on how to use those resources to make decisions. For now, most of our customers are banks, so they use those decisions to lend.You have advocated using data to help banks extend credit to the informal sector. Can you explain how this works and why you believe it can unlock more financing?Here is a way to look at it. If you think back fifteen years ago, the best kind of television was high definition. You had regular television and had high definition. Now, on regular television, you could see the pictures were pixelated. So, you can see the edge is not smooth. You can see those pixelations. My high-definition television is a lot smoother. That is kind of what we do. We take the data that is pixelated, and we help our customers, which are usually banks, to make that data smoother, so it is a better picture. So, if you look at our business from 2017 until now, we have done the equivalent of taking high definition to 8K. So, if you look at 8K, those pictures are basically lifelike.Why is that interesting? If you look at an unbanked person, it is like that old television, because the reason he is unbanked is not that he does not know where the bank is. It is because he does not see any value in talking to the banks because banks are just charging SMS fees and all sorts of fees. And that is only because the banks cannot see who he is. But when you put in technology, it makes it clear. Sometimes when you open a website, it will be all blurred, and all of a sudden it is clear. That is what we help the bank do because they see that blurry picture of an unbanked person. If you look at it through the lens of what Mathesis does, it now starts to take shape.Nigeria has several national databases, including the BVN, NIN and driver’s licence records. How can these data assets be leveraged to create economic value and unlock new financial opportunities?When I am trying to see how I can make this simple, because I am about to talk about it in mathematics. All this data, at the end of the day, some of them are just the same thing.BVN is your identity information based on banks. NIN is your general identification. The two of them are interchangeable. The driver’s licence is your identification based on the fact that you drive. The driver’s licence tells me something. It tells me that you know how to drive, and you might own a car. How do you turn all this into money? What you do is you take the data pools; with the BVN, I can see not just the individual, but I can see the economic value. In the NIN, what I would see there would be data that I can use to confirm BVNs. If I pull in your driver’s licence, in Nigeria the only thing it means is that you might own a car. Outside of Nigeria, if I pull in your driver’s licence, I also pull in your driving record, and what your driving record tells me is: are you someone that always speeds, or are you someone that has bad driving behaviour? Because if you have bad driving behaviour, you are probably going to be a bad borrower, because your driving record is your behaviour. And if we go back and look at what the things we talk about when we talk about lending are, it is the three things of lending: credit, character and collateral. If you are a bad driver, that means you are generally someone of questionable character. You take all these things, and you quantify them; you put them through an algorithm, and it will give you a score. And that score is a prediction of two things. It will predict, in some cases, how much you should lend that person, and it predicts the probability that that person will not pay you back. And that is how this whole thing becomes money. So, when you take those two scores and take them to a bank, a bank now looks at it and says, “Am I willing to take this risk?” Yes or no? If the bank says yes, all of a sudden you have created an economic event whereby the bank loans money to that person. Pays us a fee for what we do, and then the bank earns interest on that.The government has been pushing for a transition to a credit-driven economy, yet progress appears to have been slow. What do you think is holding back this transition?I think we have made some progress, but the goal that we have as a country will be achieved once the fintechs and the banks realise that they are all on the same side. Once they all realise that they are collaborators rather than competitors. Once they realise that, it opens up everything because at that point in time the banks do not have to go and look for somebody that is looking for a N5,000 loan because just doing the paperwork and the pen used in processing the loan is more than the N5,000 loan. So, what would they do? They will outsource that process to a fintech company. A fintech can do it at pennies on the naira.Related NewsDangote refinery not enough for African market – FGTinubu, Shettima, Oyedele for CIBN banking conferenceNigeria targets $100bn investment commitments at summitHow does your company strike a balance between driving innovation and complying with regulations in Nigeria’s rapidly evolving fintech industry?Regulation makes operations easier. Because if you think about a totally unregulated space, that means anybody can do anything. And then if anybody can do anything, every single time the end user has a dispute. That dispute will end up in court, and it will be left to the courts to actually go ahead and decide who, what, and where. And that entire process is expensive and time-consuming. So, if you are a fintech, dealing with thousands of customers, and one per cent of them should sue you. What happens? So, when you have thoughtful regulation, it basically tells everybody what the guard rails are. It gives you the rules of the guard rails. And once you follow those guard rails, it is clear that only things that are outside those guard rails will cost you any peril. So, regulation does not stop innovation. It just lets you understand how you play.Although the economy has achieved some stability, challenges such as inflation and exchange rate volatility persist. What role can fintech companies play in helping businesses and consumers navigate these pressures?Fintechs have no power in this. They have no power to do anything about this. What they can do on their side is structure their business in such a way that depreciation of the naira and high interest rates do not affect them. On the other side, when you talk about their customers, what can they do to help their customers? Very little. Remember, fintechs are price takers when it comes to the funds that they facilitate the lending of, and when it comes to any deposits that they are able to attract. So, there is really not much that they can do.So, how can they help small businesses?It is just being able to continue to lend through that process. So, what you will find is banks get to a point where they say, because of the economic situation, we are going to wind down our books. And when they say they are going to wind down their books, all it means is that they are going to go out and call loans. What fintechs can do is, because they are iterative, they can continue to iterate price risk intelligently so that those banks that have partnered with them can continue to lend with confidence.Looking back over the past seven years, what would you consider Mathesis’s biggest achievements and milestones?In the last seven years, we have facilitated about 8.5 million loans, about $260m. We have facilitated lending to about 2.7 million individual borrowers. We have been able to go out and provide credit to people; the vast majority of our customers come to us through USSD, which is a group that has been severely underserved in Africa.What is your vision for Mathesis over the next decade?We live in a world where ten years is forever. Ten years is if you think back ten years, it is like going into the Stone Age. If we look at the next ten years, our goal is to be the major decision engine that handles any conversation where payment and fulfilment differ across Africa. And let me explain what that means. If I go out and I pay for a car, the man says he will bring the car in two weeks. There is risk in that. Our goal is that before you make that decision, you take that guy’s information, you are going to run it through us, and we will give you the probability that he will run away with the car. Then you can make an intelligent decision if you should give him the money for that. And it is the same thing in insurance. Somebody comes today when you go to buy insurance; they just give you one number. Everybody comes and says five per cent. You fight them and say it is 2.5 per cent. However, the two of you should never get to the same rate because if I dig into your life, I should be able to find out who you are and score that and do the same for you and score that. So, if I am the insurance company, I will say you are a proper man. You do not have issues. You do not owe anybody. And because you do not owe anybody, I think you will be a good risk. And I say to the other person and say your look is disturbing; you are a high risk. The goal is that we are there every time anybody wants to make a decision. Insurance, individual, real estate, banks, etc. We help you decide if you should take on that risk.How does Mathesis differ from traditional credit bureaus?So, credit bureaus are like the post office. So, every institution has a box. And inside that box, there are individuals in it. So, anytime the person does a transaction, you take it and put it in that box. And Nigeria’s credit bureau has become negative only. Which is, no matter what you do when you are paying, they do not bother; they do not bother going to put your name in the credit bureau. The day you do not pay, they are going to put your name in the credit bureau as a bad lender. So, what they do is mechanical. They are just collating data. Some of them are just selling scores, but the predictive value is pretty low. What we do is the predictive value side. We do not run around. That is not what we do. What we do is we work with institutions to take all the data that they currently have and give them an output that has real predictive value on how each particular borrower they take out of this pool works. How each particular person is most likely to behave. And again, there is no magic to it. Do some people who have high scores default? It happens. But if you look at it over time, over the population. We get it right more often than we get it wrong.The Minister of Finance recently argued that Nigeria’s rising public debt is largely a consequence of currency devaluation rather than new borrowing by the current administration. What is your assessment of that position?Does devaluation of currency make sense? Yes, it does. It does make sense because if you take the current exchange rate and apply it, if you go back five years and you take that exchange rate and apply it, you get a different number. So, is that part of it? I am sure it is. Now, is that all it is? Probably not. The good thing is the vast majority of our borrowing has been internal. So, it has been naira-based. You do not have to worry too much. Not that you do not have to worry about it, but at least it is serviceable. So, let us look at it this way. If they were going to borrow to buy this laptop three years ago, it would be X. If they try to buy this laptop today and they borrow money to do it, it would be five times that amount. So, as I said, what he said is true, but as with the finances of anybody’s house, the finances of the country are nuanced. So, making a proclamation, this is why it happened. No. It is probably not true. You have to look at the entire process. Well, if you say that is why it happened, and the question is, why did you not increase taxes here? So, there are so many levels. So, I personally tend not to listen to those things. Nine times out of ten, if I want to understand nuanced positions, I look for people that are speaking not from a political podium, but more from an academic podium because academics tend to just talk. They have nothing to lose. They have no agenda.Do you believe the naira has reached its fair market value?Given the level of growth that we are seeing in the country, I think long term if the growth levels do not get better, the naira is going to continue to depreciate. But given that now it is free floating, I think the pace of the depreciation would be quite low. And we will see spikes up as we go along the way. So, if you look at recent history when we had a managed process, the problem with the managed process is like you take a balloon, fill it with air, and you start squeezing it on one side. After you squeeze it, it will get to a point where it will just explode. That is those crazy devaluations we used to see. We are not going to see them going forward. I think until the level of growth increases, we are going to see general depreciation going forward.What is your outlook for the economy in the second half of the year?I think it will be no different from the first part. The only thing that concerns me is that everything that is going on in the Middle East is not getting better; it is getting worse. And if it continues to get worse, the price of energy will go up. And if the price of energy goes up, that is just going to flow into everything. So, inflation might get a little higher. So, but aside from that, I do not see anything. Everybody is looking forward to election spending, but the election spending is just going to help increase inflation. So, if there is one thing I expect for the next half year is probably a little bit of a tick-up in inflation. That is about it. What inspired the establishment of Mathesis?The inspiration for the company was very simple. It was clear that people were unable to access credit where and when they needed it. I just figured that using freely available technology, we would be able to solve that problem and help everybody, help the banks lend more, help consumers access credit, and, importantly, help traders and merchants sell more to their customers.With the economy still recovering, how would you assess the current business environment, particularly the challenges and opportunities surrounding access to credit and business expansion?The business environment, really, if you want to look at our business, in truth, the only issue we have is the cost of things that we do not produce locally. So, in terms of everything local, we are fine. When it comes to how the economy affects clients? Well, you can see that borrowers are in some distress. So, there is usually a perceptible uptick in defaults from the borrowers that we help get loans.How do you expect fintech to transform financial inclusion in Nigeria over the next decade?I think fintechs are going to do something interesting, which is they are going to bring the banks closer to the individuals. What fintechs actually do is they help collect data that the bank currently does not hold, interpret that data, and provide it to the banks, and they now make intelligent decisions. At the end of the day, banks are very good at mobilising cheap deposits. They are also great at getting customers and depositors at scale. While fintechs are much better at iterating their processes and being quite innovative. So, both are going to come together and drive a significant improvement in services to current bank customers and open the doorway to bank a lot more of the unbanked people.What distinguishes your company from other fintech firms, and what unique solutions does it offer the market?What we do is analytics. The one thing we do is take data that our clients currently do not see as having any value in making decisions. We take all that data, we bring it together, and then we deliver it to our customers. We deliver to our customers the resources and suggestions on how to use those resources to make decisions. For now, most of our customers are banks, so they use those decisions to lend.You have advocated using data to help banks extend credit to the informal sector. Can you explain how this works and why you believe it can unlock more financing?Here is a way to look at it. If you think back fifteen years ago, the best kind of television was high definition. You had regular television and had high definition. Now, on regular television, you could see the pictures were pixelated. So, you can see the edge is not smooth. You can see those pixelations. My high-definition television is a lot smoother. That is kind of what we do. We take the data that is pixelated, and we help our customers, which are usually banks, to make that data smoother, so it is a better picture. So, if you look at our business from 2017 until now, we have done the equivalent of taking high definition to 8K. So, if you look at 8K, those pictures are basically lifelike.Why is that interesting? If you look at an unbanked person, it is like that old television, because the reason he is unbanked is not that he does not know where the bank is. It is because he does not see any value in talking to the banks because banks are just charging SMS fees and all sorts of fees. And that is only because the banks cannot see who he is. But when you put in technology, it makes it clear. Sometimes when you open a website, it will be all blurred, and all of a sudden it is clear. That is what we help the bank do because they see that blurry picture of an unbanked person. If you look at it through the lens of what Mathesis does, it now starts to take shape.Nigeria has several national databases, including the BVN, NIN and driver’s licence records. How can these data assets be leveraged to create economic value and unlock new financial opportunities?When I am trying to see how I can make this simple, because I am about to talk about it in mathematics. All this data, at the end of the day, some of them are just the same thing.BVN is your identity information based on banks. NIN is your general identification. The two of them are interchangeable. The driver’s licence is your identification based on the fact that you drive. The driver’s licence tells me something. It tells me that you know how to drive, and you might own a car. How do you turn all this into money? What you do is you take the data pools; with the BVN, I can see not just the individual, but I can see the economic value. In the NIN, what I would see there would be data that I can use to confirm BVNs. If I pull in your driver’s licence, in Nigeria the only thing it means is that you might own a car. Outside of Nigeria, if I pull in your driver’s licence, I also pull in your driving record, and what your driving record tells me is: are you someone that always speeds, or are you someone that has bad driving behaviour? Because if you have bad driving behaviour, you are probably going to be a bad borrower, because your driving record is your behaviour. And if we go back and look at what the things we talk about when we talk about lending are, it is the three things of lending: credit, character and collateral. If you are a bad driver, that means you are generally someone of questionable character. You take all these things, and you quantify them; you put them through an algorithm, and it will give you a score. And that score is a prediction of two things. It will predict, in some cases, how much you should lend that person, and it predicts the probability that that person will not pay you back. And that is how this whole thing becomes money. So, when you take those two scores and take them to a bank, a bank now looks at it and says, “Am I willing to take this risk?” Yes or no? If the bank says yes, all of a sudden you have created an economic event whereby the bank loans money to that person. Pays us a fee for what we do, and then the bank earns interest on that.The government has been pushing for a transition to a credit-driven economy, yet progress appears to have been slow. What do you think is holding back this transition?I think we have made some progress, but the goal that we have as a country will be achieved once the fintechs and the banks realise that they are all on the same side. Once they all realise that they are collaborators rather than competitors. Once they realise that, it opens up everything because at that point in time the banks do not have to go and look for somebody that is looking for a N5,000 loan because just doing the paperwork and the pen used in processing the loan is more than the N5,000 loan. So, what would they do? They will outsource that process to a fintech company. A fintech can do it at pennies on the naira.Related NewsDangote refinery not enough for African market – FGTinubu, Shettima, Oyedele for CIBN banking conferenceNigeria targets $100bn investment commitments at summitHow does your company strike a balance between driving innovation and complying with regulations in Nigeria’s rapidly evolving fintech industry?Regulation makes operations easier. Because if you think about a totally unregulated space, that means anybody can do anything. And then if anybody can do anything, every single time the end user has a dispute. That dispute will end up in court, and it will be left to the courts to actually go ahead and decide who, what, and where. And that entire process is expensive and time-consuming. So, if you are a fintech, dealing with thousands of customers, and one per cent of them should sue you. What happens? So, when you have thoughtful regulation, it basically tells everybody what the guard rails are. It gives you the rules of the guard rails. And once you follow those guard rails, it is clear that only things that are outside those guard rails will cost you any peril. So, regulation does not stop innovation. It just lets you understand how you play.Although the economy has achieved some stability, challenges such as inflation and exchange rate volatility persist. What role can fintech companies play in helping businesses and consumers navigate these pressures?Fintechs have no power in this. They have no power to do anything about this. What they can do on their side is structure their business in such a way that depreciation of the naira and high interest rates do not affect them. On the other side, when you talk about their customers, what can they do to help their customers? Very little. Remember, fintechs are price takers when it comes to the funds that they facilitate the lending of, and when it comes to any deposits that they are able to attract. So, there is really not much that they can do.So, how can they help small businesses?It is just being able to continue to lend through that process. So, what you will find is banks get to a point where they say, because of the economic situation, we are going to wind down our books. And when they say they are going to wind down their books, all it means is that they are going to go out and call loans. What fintechs can do is, because they are iterative, they can continue to iterate price risk intelligently so that those banks that have partnered with them can continue to lend with confidence.Looking back over the past seven years, what would you consider Mathesis’s biggest achievements and milestones?In the last seven years, we have facilitated about 8.5 million loans, about $260m. We have facilitated lending to about 2.7 million individual borrowers. We have been able to go out and provide credit to people; the vast majority of our customers come to us through USSD, which is a group that has been severely underserved in Africa.What is your vision for Mathesis over the next decade?We live in a world where ten years is forever. Ten years is if you think back ten years, it is like going into the Stone Age. If we look at the next ten years, our goal is to be the major decision engine that handles any conversation where payment and fulfilment differ across Africa. And let me explain what that means. If I go out and I pay for a car, the man says he will bring the car in two weeks. There is risk in that. Our goal is that before you make that decision, you take that guy’s information, you are going to run it through us, and we will give you the probability that he will run away with the car. Then you can make an intelligent decision if you should give him the money for that. And it is the same thing in insurance. Somebody comes today when you go to buy insurance; they just give you one number. Everybody comes and says five per cent. You fight them and say it is 2.5 per cent. However, the two of you should never get to the same rate because if I dig into your life, I should be able to find out who you are and score that and do the same for you and score that. So, if I am the insurance company, I will say you are a proper man. You do not have issues. You do not owe anybody. And because you do not owe anybody, I think you will be a good risk. And I say to the other person and say your look is disturbing; you are a high risk. The goal is that we are there every time anybody wants to make a decision. Insurance, individual, real estate, banks, etc. We help you decide if you should take on that risk.How does Mathesis differ from traditional credit bureaus?So, credit bureaus are like the post office. So, every institution has a box. And inside that box, there are individuals in it. So, anytime the person does a transaction, you take it and put it in that box. And Nigeria’s credit bureau has become negative only. Which is, no matter what you do when you are paying, they do not bother; they do not bother going to put your name in the credit bureau. The day you do not pay, they are going to put your name in the credit bureau as a bad lender. So, what they do is mechanical. They are just collating data. Some of them are just selling scores, but the predictive value is pretty low. What we do is the predictive value side. We do not run around. That is not what we do. What we do is we work with institutions to take all the data that they currently have and give them an output that has real predictive value on how each particular borrower they take out of this pool works. How each particular person is most likely to behave. And again, there is no magic to it. Do some people who have high scores default? It happens. But if you look at it over time, over the population. We get it right more often than we get it wrong.The Minister of Finance recently argued that Nigeria’s rising public debt is largely a consequence of currency devaluation rather than new borrowing by the current administration. What is your assessment of that position?Does devaluation of currency make sense? Yes, it does. It does make sense because if you take the current exchange rate and apply it, if you go back five years and you take that exchange rate and apply it, you get a different number. So, is that part of it? I am sure it is. Now, is that all it is? Probably not. The good thing is the vast majority of our borrowing has been internal. So, it has been naira-based. You do not have to worry too much. Not that you do not have to worry about it, but at least it is serviceable. So, let us look at it this way. If they were going to borrow to buy this laptop three years ago, it would be X. If they try to buy this laptop today and they borrow money to do it, it would be five times that amount. So, as I said, what he said is true, but as with the finances of anybody’s house, the finances of the country are nuanced. So, making a proclamation, this is why it happened. No. It is probably not true. You have to look at the entire process. Well, if you say that is why it happened, and the question is, why did you not increase taxes here? So, there are so many levels. So, I personally tend not to listen to those things. Nine times out of ten, if I want to understand nuanced positions, I look for people that are speaking not from a political podium, but more from an academic podium because academics tend to just talk. They have nothing to lose. They have no agenda.Do you believe the naira has reached its fair market value?Given the level of growth that we are seeing in the country, I think long term if the growth levels do not get better, the naira is going to continue to depreciate. But given that now it is free floating, I think the pace of the depreciation would be quite low. And we will see spikes up as we go along the way. So, if you look at recent history when we had a managed process, the problem with the managed process is like you take a balloon, fill it with air, and you start squeezing it on one side. After you squeeze it, it will get to a point where it will just explode. That is those crazy devaluations we used to see. We are not going to see them going forward. I think until the level of growth increases, we are going to see general depreciation going forward.What is your outlook for the economy in the second half of the year?I think it will be no different from the first part. The only thing that concerns me is that everything that is going on in the Middle East is not getting better; it is getting worse. And if it continues to get worse, the price of energy will go up. And if the price of energy goes up, that is just going to flow into everything. So, inflation might get a little higher. So, but aside from that, I do not see anything. Everybody is looking forward to election spending, but the election spending is just going to help increase inflation. So, if there is one thing I expect for the next half year is probably a little bit of a tick-up in inflation. That is about it. The inspiration for the company was very simple. It was clear that people were unable to access credit where and when they needed it. I just figured that using freely available technology, we would be able to solve that problem and help everybody, help the banks lend more, help consumers access credit, and, importantly, help traders and merchants sell more to their customers.With the economy still recovering, how would you assess the current business environment, particularly the challenges and opportunities surrounding access to credit and business expansion?The business environment, really, if you want to look at our business, in truth, the only issue we have is the cost of things that we do not produce locally. So, in terms of everything local, we are fine. When it comes to how the economy affects clients? Well, you can see that borrowers are in some distress. So, there is usually a perceptible uptick in defaults from the borrowers that we help get loans.How do you expect fintech to transform financial inclusion in Nigeria over the next decade?I think fintechs are going to do something interesting, which is they are going to bring the banks closer to the individuals. What fintechs actually do is they help collect data that the bank currently does not hold, interpret that data, and provide it to the banks, and they now make intelligent decisions. At the end of the day, banks are very good at mobilising cheap deposits. They are also great at getting customers and depositors at scale. While fintechs are much better at iterating their processes and being quite innovative. So, both are going to come together and drive a significant improvement in services to current bank customers and open the doorway to bank a lot more of the unbanked people.What distinguishes your company from other fintech firms, and what unique solutions does it offer the market?What we do is analytics. The one thing we do is take data that our clients currently do not see as having any value in making decisions. We take all that data, we bring it together, and then we deliver it to our customers. We deliver to our customers the resources and suggestions on how to use those resources to make decisions. For now, most of our customers are banks, so they use those decisions to lend.You have advocated using data to help banks extend credit to the informal sector. Can you explain how this works and why you believe it can unlock more financing?Here is a way to look at it. If you think back fifteen years ago, the best kind of television was high definition. You had regular television and had high definition. Now, on regular television, you could see the pictures were pixelated. So, you can see the edge is not smooth. You can see those pixelations. My high-definition television is a lot smoother. That is kind of what we do. We take the data that is pixelated, and we help our customers, which are usually banks, to make that data smoother, so it is a better picture. So, if you look at our business from 2017 until now, we have done the equivalent of taking high definition to 8K. So, if you look at 8K, those pictures are basically lifelike.Why is that interesting? If you look at an unbanked person, it is like that old television, because the reason he is unbanked is not that he does not know where the bank is. It is because he does not see any value in talking to the banks because banks are just charging SMS fees and all sorts of fees. And that is only because the banks cannot see who he is. But when you put in technology, it makes it clear. Sometimes when you open a website, it will be all blurred, and all of a sudden it is clear. That is what we help the bank do because they see that blurry picture of an unbanked person. If you look at it through the lens of what Mathesis does, it now starts to take shape.Nigeria has several national databases, including the BVN, NIN and driver’s licence records. How can these data assets be leveraged to create economic value and unlock new financial opportunities?When I am trying to see how I can make this simple, because I am about to talk about it in mathematics. All this data, at the end of the day, some of them are just the same thing.BVN is your identity information based on banks. NIN is your general identification. The two of them are interchangeable. The driver’s licence is your identification based on the fact that you drive. The driver’s licence tells me something. It tells me that you know how to drive, and you might own a car. How do you turn all this into money? What you do is you take the data pools; with the BVN, I can see not just the individual, but I can see the economic value. In the NIN, what I would see there would be data that I can use to confirm BVNs. If I pull in your driver’s licence, in Nigeria the only thing it means is that you might own a car. Outside of Nigeria, if I pull in your driver’s licence, I also pull in your driving record, and what your driving record tells me is: are you someone that always speeds, or are you someone that has bad driving behaviour? Because if you have bad driving behaviour, you are probably going to be a bad borrower, because your driving record is your behaviour. And if we go back and look at what the things we talk about when we talk about lending are, it is the three things of lending: credit, character and collateral. If you are a bad driver, that means you are generally someone of questionable character. You take all these things, and you quantify them; you put them through an algorithm, and it will give you a score. And that score is a prediction of two things. It will predict, in some cases, how much you should lend that person, and it predicts the probability that that person will not pay you back. And that is how this whole thing becomes money. So, when you take those two scores and take them to a bank, a bank now looks at it and says, “Am I willing to take this risk?” Yes or no? If the bank says yes, all of a sudden you have created an economic event whereby the bank loans money to that person. Pays us a fee for what we do, and then the bank earns interest on that.The government has been pushing for a transition to a credit-driven economy, yet progress appears to have been slow. What do you think is holding back this transition?I think we have made some progress, but the goal that we have as a country will be achieved once the fintechs and the banks realise that they are all on the same side. Once they all realise that they are collaborators rather than competitors. Once they realise that, it opens up everything because at that point in time the banks do not have to go and look for somebody that is looking for a N5,000 loan because just doing the paperwork and the pen used in processing the loan is more than the N5,000 loan. So, what would they do? They will outsource that process to a fintech company. A fintech can do it at pennies on the naira.Related NewsDangote refinery not enough for African market – FGTinubu, Shettima, Oyedele for CIBN banking conferenceNigeria targets $100bn investment commitments at summitHow does your company strike a balance between driving innovation and complying with regulations in Nigeria’s rapidly evolving fintech industry?Regulation makes operations easier. Because if you think about a totally unregulated space, that means anybody can do anything. And then if anybody can do anything, every single time the end user has a dispute. That dispute will end up in court, and it will be left to the courts to actually go ahead and decide who, what, and where. And that entire process is expensive and time-consuming. So, if you are a fintech, dealing with thousands of customers, and one per cent of them should sue you. What happens? So, when you have thoughtful regulation, it basically tells everybody what the guard rails are. It gives you the rules of the guard rails. And once you follow those guard rails, it is clear that only things that are outside those guard rails will cost you any peril. So, regulation does not stop innovation. It just lets you understand how you play.Although the economy has achieved some stability, challenges such as inflation and exchange rate volatility persist. What role can fintech companies play in helping businesses and consumers navigate these pressures?Fintechs have no power in this. They have no power to do anything about this. What they can do on their side is structure their business in such a way that depreciation of the naira and high interest rates do not affect them. On the other side, when you talk about their customers, what can they do to help their customers? Very little. Remember, fintechs are price takers when it comes to the funds that they facilitate the lending of, and when it comes to any deposits that they are able to attract. So, there is really not much that they can do.So, how can they help small businesses?It is just being able to continue to lend through that process. So, what you will find is banks get to a point where they say, because of the economic situation, we are going to wind down our books. And when they say they are going to wind down their books, all it means is that they are going to go out and call loans. What fintechs can do is, because they are iterative, they can continue to iterate price risk intelligently so that those banks that have partnered with them can continue to lend with confidence.Looking back over the past seven years, what would you consider Mathesis’s biggest achievements and milestones?In the last seven years, we have facilitated about 8.5 million loans, about $260m. We have facilitated lending to about 2.7 million individual borrowers. We have been able to go out and provide credit to people; the vast majority of our customers come to us through USSD, which is a group that has been severely underserved in Africa.What is your vision for Mathesis over the next decade?We live in a world where ten years is forever. Ten years is if you think back ten years, it is like going into the Stone Age. If we look at the next ten years, our goal is to be the major decision engine that handles any conversation where payment and fulfilment differ across Africa. And let me explain what that means. If I go out and I pay for a car, the man says he will bring the car in two weeks. There is risk in that. Our goal is that before you make that decision, you take that guy’s information, you are going to run it through us, and we will give you the probability that he will run away with the car. Then you can make an intelligent decision if you should give him the money for that. And it is the same thing in insurance. Somebody comes today when you go to buy insurance; they just give you one number. Everybody comes and says five per cent. You fight them and say it is 2.5 per cent. However, the two of you should never get to the same rate because if I dig into your life, I should be able to find out who you are and score that and do the same for you and score that. So, if I am the insurance company, I will say you are a proper man. You do not have issues. You do not owe anybody. And because you do not owe anybody, I think you will be a good risk. And I say to the other person and say your look is disturbing; you are a high risk. The goal is that we are there every time anybody wants to make a decision. Insurance, individual, real estate, banks, etc. We help you decide if you should take on that risk.How does Mathesis differ from traditional credit bureaus?So, credit bureaus are like the post office. So, every institution has a box. And inside that box, there are individuals in it. So, anytime the person does a transaction, you take it and put it in that box. And Nigeria’s credit bureau has become negative only. Which is, no matter what you do when you are paying, they do not bother; they do not bother going to put your name in the credit bureau. The day you do not pay, they are going to put your name in the credit bureau as a bad lender. So, what they do is mechanical. They are just collating data. Some of them are just selling scores, but the predictive value is pretty low. What we do is the predictive value side. We do not run around. That is not what we do. What we do is we work with institutions to take all the data that they currently have and give them an output that has real predictive value on how each particular borrower they take out of this pool works. How each particular person is most likely to behave. And again, there is no magic to it. Do some people who have high scores default? It happens. But if you look at it over time, over the population. We get it right more often than we get it wrong.The Minister of Finance recently argued that Nigeria’s rising public debt is largely a consequence of currency devaluation rather than new borrowing by the current administration. What is your assessment of that position?Does devaluation of currency make sense? Yes, it does. It does make sense because if you take the current exchange rate and apply it, if you go back five years and you take that exchange rate and apply it, you get a different number. So, is that part of it? I am sure it is. Now, is that all it is? Probably not. The good thing is the vast majority of our borrowing has been internal. So, it has been naira-based. You do not have to worry too much. Not that you do not have to worry about it, but at least it is serviceable. So, let us look at it this way. If they were going to borrow to buy this laptop three years ago, it would be X. If they try to buy this laptop today and they borrow money to do it, it would be five times that amount. So, as I said, what he said is true, but as with the finances of anybody’s house, the finances of the country are nuanced. So, making a proclamation, this is why it happened. No. It is probably not true. You have to look at the entire process. Well, if you say that is why it happened, and the question is, why did you not increase taxes here? So, there are so many levels. So, I personally tend not to listen to those things. Nine times out of ten, if I want to understand nuanced positions, I look for people that are speaking not from a political podium, but more from an academic podium because academics tend to just talk. They have nothing to lose. They have no agenda.Do you believe the naira has reached its fair market value?Given the level of growth that we are seeing in the country, I think long term if the growth levels do not get better, the naira is going to continue to depreciate. But given that now it is free floating, I think the pace of the depreciation would be quite low. And we will see spikes up as we go along the way. So, if you look at recent history when we had a managed process, the problem with the managed process is like you take a balloon, fill it with air, and you start squeezing it on one side. After you squeeze it, it will get to a point where it will just explode. That is those crazy devaluations we used to see. We are not going to see them going forward. I think until the level of growth increases, we are going to see general depreciation going forward.What is your outlook for the economy in the second half of the year?I think it will be no different from the first part. The only thing that concerns me is that everything that is going on in the Middle East is not getting better; it is getting worse. And if it continues to get worse, the price of energy will go up. And if the price of energy goes up, that is just going to flow into everything. So, inflation might get a little higher. So, but aside from that, I do not see anything. Everybody is looking forward to election spending, but the election spending is just going to help increase inflation. So, if there is one thing I expect for the next half year is probably a little bit of a tick-up in inflation. That is about it. With the economy still recovering, how would you assess the current business environment, particularly the challenges and opportunities surrounding access to credit and business expansion?The business environment, really, if you want to look at our business, in truth, the only issue we have is the cost of things that we do not produce locally. So, in terms of everything local, we are fine. When it comes to how the economy affects clients? Well, you can see that borrowers are in some distress. So, there is usually a perceptible uptick in defaults from the borrowers that we help get loans.How do you expect fintech to transform financial inclusion in Nigeria over the next decade?I think fintechs are going to do something interesting, which is they are going to bring the banks closer to the individuals. What fintechs actually do is they help collect data that the bank currently does not hold, interpret that data, and provide it to the banks, and they now make intelligent decisions. At the end of the day, banks are very good at mobilising cheap deposits. They are also great at getting customers and depositors at scale. While fintechs are much better at iterating their processes and being quite innovative. So, both are going to come together and drive a significant improvement in services to current bank customers and open the doorway to bank a lot more of the unbanked people.What distinguishes your company from other fintech firms, and what unique solutions does it offer the market?What we do is analytics. The one thing we do is take data that our clients currently do not see as having any value in making decisions. We take all that data, we bring it together, and then we deliver it to our customers. We deliver to our customers the resources and suggestions on how to use those resources to make decisions. For now, most of our customers are banks, so they use those decisions to lend.You have advocated using data to help banks extend credit to the informal sector. Can you explain how this works and why you believe it can unlock more financing?Here is a way to look at it. If you think back fifteen years ago, the best kind of television was high definition. You had regular television and had high definition. Now, on regular television, you could see the pictures were pixelated. So, you can see the edge is not smooth. You can see those pixelations. My high-definition television is a lot smoother. That is kind of what we do. We take the data that is pixelated, and we help our customers, which are usually banks, to make that data smoother, so it is a better picture. So, if you look at our business from 2017 until now, we have done the equivalent of taking high definition to 8K. So, if you look at 8K, those pictures are basically lifelike.Why is that interesting? If you look at an unbanked person, it is like that old television, because the reason he is unbanked is not that he does not know where the bank is. It is because he does not see any value in talking to the banks because banks are just charging SMS fees and all sorts of fees. And that is only because the banks cannot see who he is. But when you put in technology, it makes it clear. Sometimes when you open a website, it will be all blurred, and all of a sudden it is clear. That is what we help the bank do because they see that blurry picture of an unbanked person. If you look at it through the lens of what Mathesis does, it now starts to take shape.Nigeria has several national databases, including the BVN, NIN and driver’s licence records. How can these data assets be leveraged to create economic value and unlock new financial opportunities?When I am trying to see how I can make this simple, because I am about to talk about it in mathematics. All this data, at the end of the day, some of them are just the same thing.BVN is your identity information based on banks. NIN is your general identification. The two of them are interchangeable. The driver’s licence is your identification based on the fact that you drive. The driver’s licence tells me something. It tells me that you know how to drive, and you might own a car. How do you turn all this into money? What you do is you take the data pools; with the BVN, I can see not just the individual, but I can see the economic value. In the NIN, what I would see there would be data that I can use to confirm BVNs. If I pull in your driver’s licence, in Nigeria the only thing it means is that you might own a car. Outside of Nigeria, if I pull in your driver’s licence, I also pull in your driving record, and what your driving record tells me is: are you someone that always speeds, or are you someone that has bad driving behaviour? Because if you have bad driving behaviour, you are probably going to be a bad borrower, because your driving record is your behaviour. And if we go back and look at what the things we talk about when we talk about lending are, it is the three things of lending: credit, character and collateral. If you are a bad driver, that means you are generally someone of questionable character. You take all these things, and you quantify them; you put them through an algorithm, and it will give you a score. And that score is a prediction of two things. It will predict, in some cases, how much you should lend that person, and it predicts the probability that that person will not pay you back. And that is how this whole thing becomes money. So, when you take those two scores and take them to a bank, a bank now looks at it and says, “Am I willing to take this risk?” Yes or no? If the bank says yes, all of a sudden you have created an economic event whereby the bank loans money to that person. Pays us a fee for what we do, and then the bank earns interest on that.The government has been pushing for a transition to a credit-driven economy, yet progress appears to have been slow. What do you think is holding back this transition?I think we have made some progress, but the goal that we have as a country will be achieved once the fintechs and the banks realise that they are all on the same side. Once they all realise that they are collaborators rather than competitors. Once they realise that, it opens up everything because at that point in time the banks do not have to go and look for somebody that is looking for a N5,000 loan because just doing the paperwork and the pen used in processing the loan is more than the N5,000 loan. So, what would they do? They will outsource that process to a fintech company. A fintech can do it at pennies on the naira.Related NewsDangote refinery not enough for African market – FGTinubu, Shettima, Oyedele for CIBN banking conferenceNigeria targets $100bn investment commitments at summitHow does your company strike a balance between driving innovation and complying with regulations in Nigeria’s rapidly evolving fintech industry?Regulation makes operations easier. Because if you think about a totally unregulated space, that means anybody can do anything. And then if anybody can do anything, every single time the end user has a dispute. That dispute will end up in court, and it will be left to the courts to actually go ahead and decide who, what, and where. And that entire process is expensive and time-consuming. So, if you are a fintech, dealing with thousands of customers, and one per cent of them should sue you. What happens? So, when you have thoughtful regulation, it basically tells everybody what the guard rails are. It gives you the rules of the guard rails. And once you follow those guard rails, it is clear that only things that are outside those guard rails will cost you any peril. So, regulation does not stop innovation. It just lets you understand how you play.Although the economy has achieved some stability, challenges such as inflation and exchange rate volatility persist. What role can fintech companies play in helping businesses and consumers navigate these pressures?Fintechs have no power in this. They have no power to do anything about this. What they can do on their side is structure their business in such a way that depreciation of the naira and high interest rates do not affect them. On the other side, when you talk about their customers, what can they do to help their customers? Very little. Remember, fintechs are price takers when it comes to the funds that they facilitate the lending of, and when it comes to any deposits that they are able to attract. So, there is really not much that they can do.So, how can they help small businesses?It is just being able to continue to lend through that process. So, what you will find is banks get to a point where they say, because of the economic situation, we are going to wind down our books. And when they say they are going to wind down their books, all it means is that they are going to go out and call loans. What fintechs can do is, because they are iterative, they can continue to iterate price risk intelligently so that those banks that have partnered with them can continue to lend with confidence.Looking back over the past seven years, what would you consider Mathesis’s biggest achievements and milestones?In the last seven years, we have facilitated about 8.5 million loans, about $260m. We have facilitated lending to about 2.7 million individual borrowers. We have been able to go out and provide credit to people; the vast majority of our customers come to us through USSD, which is a group that has been severely underserved in Africa.What is your vision for Mathesis over the next decade?We live in a world where ten years is forever. Ten years is if you think back ten years, it is like going into the Stone Age. If we look at the next ten years, our goal is to be the major decision engine that handles any conversation where payment and fulfilment differ across Africa. And let me explain what that means. If I go out and I pay for a car, the man says he will bring the car in two weeks. There is risk in that. Our goal is that before you make that decision, you take that guy’s information, you are going to run it through us, and we will give you the probability that he will run away with the car. Then you can make an intelligent decision if you should give him the money for that. And it is the same thing in insurance. Somebody comes today when you go to buy insurance; they just give you one number. Everybody comes and says five per cent. You fight them and say it is 2.5 per cent. However, the two of you should never get to the same rate because if I dig into your life, I should be able to find out who you are and score that and do the same for you and score that. So, if I am the insurance company, I will say you are a proper man. You do not have issues. You do not owe anybody. And because you do not owe anybody, I think you will be a good risk. And I say to the other person and say your look is disturbing; you are a high risk. The goal is that we are there every time anybody wants to make a decision. Insurance, individual, real estate, banks, etc. We help you decide if you should take on that risk.How does Mathesis differ from traditional credit bureaus?So, credit bureaus are like the post office. So, every institution has a box. And inside that box, there are individuals in it. So, anytime the person does a transaction, you take it and put it in that box. And Nigeria’s credit bureau has become negative only. Which is, no matter what you do when you are paying, they do not bother; they do not bother going to put your name in the credit bureau. The day you do not pay, they are going to put your name in the credit bureau as a bad lender. So, what they do is mechanical. They are just collating data. Some of them are just selling scores, but the predictive value is pretty low. What we do is the predictive value side. We do not run around. That is not what we do. What we do is we work with institutions to take all the data that they currently have and give them an output that has real predictive value on how each particular borrower they take out of this pool works. How each particular person is most likely to behave. And again, there is no magic to it. Do some people who have high scores default? It happens. But if you look at it over time, over the population. We get it right more often than we get it wrong.The Minister of Finance recently argued that Nigeria’s rising public debt is largely a consequence of currency devaluation rather than new borrowing by the current administration. What is your assessment of that position?Does devaluation of currency make sense? Yes, it does. It does make sense because if you take the current exchange rate and apply it, if you go back five years and you take that exchange rate and apply it, you get a different number. So, is that part of it? I am sure it is. Now, is that all it is? Probably not. The good thing is the vast majority of our borrowing has been internal. So, it has been naira-based. You do not have to worry too much. Not that you do not have to worry about it, but at least it is serviceable. So, let us look at it this way. If they were going to borrow to buy this laptop three years ago, it would be X. If they try to buy this laptop today and they borrow money to do it, it would be five times that amount. So, as I said, what he said is true, but as with the finances of anybody’s house, the finances of the country are nuanced. So, making a proclamation, this is why it happened. No. It is probably not true. You have to look at the entire process. Well, if you say that is why it happened, and the question is, why did you not increase taxes here? So, there are so many levels. So, I personally tend not to listen to those things. Nine times out of ten, if I want to understand nuanced positions, I look for people that are speaking not from a political podium, but more from an academic podium because academics tend to just talk. They have nothing to lose. They have no agenda.Do you believe the naira has reached its fair market value?Given the level of growth that we are seeing in the country, I think long term if the growth levels do not get better, the naira is going to continue to depreciate. But given that now it is free floating, I think the pace of the depreciation would be quite low. And we will see spikes up as we go along the way. So, if you look at recent history when we had a managed process, the problem with the managed process is like you take a balloon, fill it with air, and you start squeezing it on one side. After you squeeze it, it will get to a point where it will just explode. That is those crazy devaluations we used to see. We are not going to see them going forward. I think until the level of growth increases, we are going to see general depreciation going forward.What is your outlook for the economy in the second half of the year?I think it will be no different from the first part. The only thing that concerns me is that everything that is going on in the Middle East is not getting better; it is getting worse. And if it continues to get worse, the price of energy will go up. And if the price of energy goes up, that is just going to flow into everything. So, inflation might get a little higher. So, but aside from that, I do not see anything. Everybody is looking forward to election spending, but the election spending is just going to help increase inflation. So, if there is one thing I expect for the next half year is probably a little bit of a tick-up in inflation. That is about it. The business environment, really, if you want to look at our business, in truth, the only issue we have is the cost of things that we do not produce locally. So, in terms of everything local, we are fine. When it comes to how the economy affects clients? Well, you can see that borrowers are in some distress. So, there is usually a perceptible uptick in defaults from the borrowers that we help get loans.How do you expect fintech to transform financial inclusion in Nigeria over the next decade?I think fintechs are going to do something interesting, which is they are going to bring the banks closer to the individuals. What fintechs actually do is they help collect data that the bank currently does not hold, interpret that data, and provide it to the banks, and they now make intelligent decisions. At the end of the day, banks are very good at mobilising cheap deposits. They are also great at getting customers and depositors at scale. While fintechs are much better at iterating their processes and being quite innovative. So, both are going to come together and drive a significant improvement in services to current bank customers and open the doorway to bank a lot more of the unbanked people.What distinguishes your company from other fintech firms, and what unique solutions does it offer the market?What we do is analytics. The one thing we do is take data that our clients currently do not see as having any value in making decisions. We take all that data, we bring it together, and then we deliver it to our customers. We deliver to our customers the resources and suggestions on how to use those resources to make decisions. For now, most of our customers are banks, so they use those decisions to lend.You have advocated using data to help banks extend credit to the informal sector. Can you explain how this works and why you believe it can unlock more financing?Here is a way to look at it. If you think back fifteen years ago, the best kind of television was high definition. You had regular television and had high definition. Now, on regular television, you could see the pictures were pixelated. So, you can see the edge is not smooth. You can see those pixelations. My high-definition television is a lot smoother. That is kind of what we do. We take the data that is pixelated, and we help our customers, which are usually banks, to make that data smoother, so it is a better picture. So, if you look at our business from 2017 until now, we have done the equivalent of taking high definition to 8K. So, if you look at 8K, those pictures are basically lifelike.Why is that interesting? If you look at an unbanked person, it is like that old television, because the reason he is unbanked is not that he does not know where the bank is. It is because he does not see any value in talking to the banks because banks are just charging SMS fees and all sorts of fees. And that is only because the banks cannot see who he is. But when you put in technology, it makes it clear. Sometimes when you open a website, it will be all blurred, and all of a sudden it is clear. That is what we help the bank do because they see that blurry picture of an unbanked person. If you look at it through the lens of what Mathesis does, it now starts to take shape.Nigeria has several national databases, including the BVN, NIN and driver’s licence records. How can these data assets be leveraged to create economic value and unlock new financial opportunities?When I am trying to see how I can make this simple, because I am about to talk about it in mathematics. All this data, at the end of the day, some of them are just the same thing.BVN is your identity information based on banks. NIN is your general identification. The two of them are interchangeable. The driver’s licence is your identification based on the fact that you drive. The driver’s licence tells me something. It tells me that you know how to drive, and you might own a car. How do you turn all this into money? What you do is you take the data pools; with the BVN, I can see not just the individual, but I can see the economic value. In the NIN, what I would see there would be data that I can use to confirm BVNs. If I pull in your driver’s licence, in Nigeria the only thing it means is that you might own a car. Outside of Nigeria, if I pull in your driver’s licence, I also pull in your driving record, and what your driving record tells me is: are you someone that always speeds, or are you someone that has bad driving behaviour? Because if you have bad driving behaviour, you are probably going to be a bad borrower, because your driving record is your behaviour. And if we go back and look at what the things we talk about when we talk about lending are, it is the three things of lending: credit, character and collateral. If you are a bad driver, that means you are generally someone of questionable character. You take all these things, and you quantify them; you put them through an algorithm, and it will give you a score. And that score is a prediction of two things. It will predict, in some cases, how much you should lend that person, and it predicts the probability that that person will not pay you back. And that is how this whole thing becomes money. So, when you take those two scores and take them to a bank, a bank now looks at it and says, “Am I willing to take this risk?” Yes or no? If the bank says yes, all of a sudden you have created an economic event whereby the bank loans money to that person. Pays us a fee for what we do, and then the bank earns interest on that.The government has been pushing for a transition to a credit-driven economy, yet progress appears to have been slow. What do you think is holding back this transition?I think we have made some progress, but the goal that we have as a country will be achieved once the fintechs and the banks realise that they are all on the same side. Once they all realise that they are collaborators rather than competitors. Once they realise that, it opens up everything because at that point in time the banks do not have to go and look for somebody that is looking for a N5,000 loan because just doing the paperwork and the pen used in processing the loan is more than the N5,000 loan. So, what would they do? They will outsource that process to a fintech company. A fintech can do it at pennies on the naira.Related NewsDangote refinery not enough for African market – FGTinubu, Shettima, Oyedele for CIBN banking conferenceNigeria targets $100bn investment commitments at summitHow does your company strike a balance between driving innovation and complying with regulations in Nigeria’s rapidly evolving fintech industry?Regulation makes operations easier. Because if you think about a totally unregulated space, that means anybody can do anything. And then if anybody can do anything, every single time the end user has a dispute. That dispute will end up in court, and it will be left to the courts to actually go ahead and decide who, what, and where. And that entire process is expensive and time-consuming. So, if you are a fintech, dealing with thousands of customers, and one per cent of them should sue you. What happens? So, when you have thoughtful regulation, it basically tells everybody what the guard rails are. It gives you the rules of the guard rails. And once you follow those guard rails, it is clear that only things that are outside those guard rails will cost you any peril. So, regulation does not stop innovation. It just lets you understand how you play.Although the economy has achieved some stability, challenges such as inflation and exchange rate volatility persist. What role can fintech companies play in helping businesses and consumers navigate these pressures?Fintechs have no power in this. They have no power to do anything about this. What they can do on their side is structure their business in such a way that depreciation of the naira and high interest rates do not affect them. On the other side, when you talk about their customers, what can they do to help their customers? Very little. Remember, fintechs are price takers when it comes to the funds that they facilitate the lending of, and when it comes to any deposits that they are able to attract. So, there is really not much that they can do.So, how can they help small businesses?It is just being able to continue to lend through that process. So, what you will find is banks get to a point where they say, because of the economic situation, we are going to wind down our books. And when they say they are going to wind down their books, all it means is that they are going to go out and call loans. What fintechs can do is, because they are iterative, they can continue to iterate price risk intelligently so that those banks that have partnered with them can continue to lend with confidence.Looking back over the past seven years, what would you consider Mathesis’s biggest achievements and milestones?In the last seven years, we have facilitated about 8.5 million loans, about $260m. We have facilitated lending to about 2.7 million individual borrowers. We have been able to go out and provide credit to people; the vast majority of our customers come to us through USSD, which is a group that has been severely underserved in Africa.What is your vision for Mathesis over the next decade?We live in a world where ten years is forever. Ten years is if you think back ten years, it is like going into the Stone Age. If we look at the next ten years, our goal is to be the major decision engine that handles any conversation where payment and fulfilment differ across Africa. And let me explain what that means. If I go out and I pay for a car, the man says he will bring the car in two weeks. There is risk in that. Our goal is that before you make that decision, you take that guy’s information, you are going to run it through us, and we will give you the probability that he will run away with the car. Then you can make an intelligent decision if you should give him the money for that. And it is the same thing in insurance. Somebody comes today when you go to buy insurance; they just give you one number. Everybody comes and says five per cent. You fight them and say it is 2.5 per cent. However, the two of you should never get to the same rate because if I dig into your life, I should be able to find out who you are and score that and do the same for you and score that. So, if I am the insurance company, I will say you are a proper man. You do not have issues. You do not owe anybody. And because you do not owe anybody, I think you will be a good risk. And I say to the other person and say your look is disturbing; you are a high risk. The goal is that we are there every time anybody wants to make a decision. Insurance, individual, real estate, banks, etc. We help you decide if you should take on that risk.How does Mathesis differ from traditional credit bureaus?So, credit bureaus are like the post office. So, every institution has a box. And inside that box, there are individuals in it. So, anytime the person does a transaction, you take it and put it in that box. And Nigeria’s credit bureau has become negative only. Which is, no matter what you do when you are paying, they do not bother; they do not bother going to put your name in the credit bureau. The day you do not pay, they are going to put your name in the credit bureau as a bad lender. So, what they do is mechanical. They are just collating data. Some of them are just selling scores, but the predictive value is pretty low. What we do is the predictive value side. We do not run around. That is not what we do. What we do is we work with institutions to take all the data that they currently have and give them an output that has real predictive value on how each particular borrower they take out of this pool works. How each particular person is most likely to behave. And again, there is no magic to it. Do some people who have high scores default? It happens. But if you look at it over time, over the population. We get it right more often than we get it wrong.The Minister of Finance recently argued that Nigeria’s rising public debt is largely a consequence of currency devaluation rather than new borrowing by the current administration. What is your assessment of that position?Does devaluation of currency make sense? Yes, it does. It does make sense because if you take the current exchange rate and apply it, if you go back five years and you take that exchange rate and apply it, you get a different number. So, is that part of it? I am sure it is. Now, is that all it is? Probably not. The good thing is the vast majority of our borrowing has been internal. So, it has been naira-based. You do not have to worry too much. Not that you do not have to worry about it, but at least it is serviceable. So, let us look at it this way. If they were going to borrow to buy this laptop three years ago, it would be X. If they try to buy this laptop today and they borrow money to do it, it would be five times that amount. So, as I said, what he said is true, but as with the finances of anybody’s house, the finances of the country are nuanced. So, making a proclamation, this is why it happened. No. It is probably not true. You have to look at the entire process. Well, if you say that is why it happened, and the question is, why did you not increase taxes here? So, there are so many levels. So, I personally tend not to listen to those things. Nine times out of ten, if I want to understand nuanced positions, I look for people that are speaking not from a political podium, but more from an academic podium because academics tend to just talk. They have nothing to lose. They have no agenda.Do you believe the naira has reached its fair market value?Given the level of growth that we are seeing in the country, I think long term if the growth levels do not get better, the naira is going to continue to depreciate. But given that now it is free floating, I think the pace of the depreciation would be quite low. And we will see spikes up as we go along the way. So, if you look at recent history when we had a managed process, the problem with the managed process is like you take a balloon, fill it with air, and you start squeezing it on one side. After you squeeze it, it will get to a point where it will just explode. That is those crazy devaluations we used to see. We are not going to see them going forward. I think until the level of growth increases, we are going to see general depreciation going forward.What is your outlook for the economy in the second half of the year?I think it will be no different from the first part. The only thing that concerns me is that everything that is going on in the Middle East is not getting better; it is getting worse. And if it continues to get worse, the price of energy will go up. And if the price of energy goes up, that is just going to flow into everything. So, inflation might get a little higher. So, but aside from that, I do not see anything. Everybody is looking forward to election spending, but the election spending is just going to help increase inflation. So, if there is one thing I expect for the next half year is probably a little bit of a tick-up in inflation. That is about it. How do you expect fintech to transform financial inclusion in Nigeria over the next decade?I think fintechs are going to do something interesting, which is they are going to bring the banks closer to the individuals. What fintechs actually do is they help collect data that the bank currently does not hold, interpret that data, and provide it to the banks, and they now make intelligent decisions. At the end of the day, banks are very good at mobilising cheap deposits. They are also great at getting customers and depositors at scale. While fintechs are much better at iterating their processes and being quite innovative. So, both are going to come together and drive a significant improvement in services to current bank customers and open the doorway to bank a lot more of the unbanked people.What distinguishes your company from other fintech firms, and what unique solutions does it offer the market?What we do is analytics. The one thing we do is take data that our clients currently do not see as having any value in making decisions. We take all that data, we bring it together, and then we deliver it to our customers. We deliver to our customers the resources and suggestions on how to use those resources to make decisions. For now, most of our customers are banks, so they use those decisions to lend.You have advocated using data to help banks extend credit to the informal sector. Can you explain how this works and why you believe it can unlock more financing?Here is a way to look at it. If you think back fifteen years ago, the best kind of television was high definition. You had regular television and had high definition. Now, on regular television, you could see the pictures were pixelated. So, you can see the edge is not smooth. You can see those pixelations. My high-definition television is a lot smoother. That is kind of what we do. We take the data that is pixelated, and we help our customers, which are usually banks, to make that data smoother, so it is a better picture. So, if you look at our business from 2017 until now, we have done the equivalent of taking high definition to 8K. So, if you look at 8K, those pictures are basically lifelike.Why is that interesting? If you look at an unbanked person, it is like that old television, because the reason he is unbanked is not that he does not know where the bank is. It is because he does not see any value in talking to the banks because banks are just charging SMS fees and all sorts of fees. And that is only because the banks cannot see who he is. But when you put in technology, it makes it clear. Sometimes when you open a website, it will be all blurred, and all of a sudden it is clear. That is what we help the bank do because they see that blurry picture of an unbanked person. If you look at it through the lens of what Mathesis does, it now starts to take shape.Nigeria has several national databases, including the BVN, NIN and driver’s licence records. How can these data assets be leveraged to create economic value and unlock new financial opportunities?When I am trying to see how I can make this simple, because I am about to talk about it in mathematics. All this data, at the end of the day, some of them are just the same thing.BVN is your identity information based on banks. NIN is your general identification. The two of them are interchangeable. The driver’s licence is your identification based on the fact that you drive. The driver’s licence tells me something. It tells me that you know how to drive, and you might own a car. How do you turn all this into money? What you do is you take the data pools; with the BVN, I can see not just the individual, but I can see the economic value. In the NIN, what I would see there would be data that I can use to confirm BVNs. If I pull in your driver’s licence, in Nigeria the only thing it means is that you might own a car. Outside of Nigeria, if I pull in your driver’s licence, I also pull in your driving record, and what your driving record tells me is: are you someone that always speeds, or are you someone that has bad driving behaviour? Because if you have bad driving behaviour, you are probably going to be a bad borrower, because your driving record is your behaviour. And if we go back and look at what the things we talk about when we talk about lending are, it is the three things of lending: credit, character and collateral. If you are a bad driver, that means you are generally someone of questionable character. You take all these things, and you quantify them; you put them through an algorithm, and it will give you a score. And that score is a prediction of two things. It will predict, in some cases, how much you should lend that person, and it predicts the probability that that person will not pay you back. And that is how this whole thing becomes money. So, when you take those two scores and take them to a bank, a bank now looks at it and says, “Am I willing to take this risk?” Yes or no? If the bank says yes, all of a sudden you have created an economic event whereby the bank loans money to that person. Pays us a fee for what we do, and then the bank earns interest on that.The government has been pushing for a transition to a credit-driven economy, yet progress appears to have been slow. What do you think is holding back this transition?I think we have made some progress, but the goal that we have as a country will be achieved once the fintechs and the banks realise that they are all on the same side. Once they all realise that they are collaborators rather than competitors. Once they realise that, it opens up everything because at that point in time the banks do not have to go and look for somebody that is looking for a N5,000 loan because just doing the paperwork and the pen used in processing the loan is more than the N5,000 loan. So, what would they do? They will outsource that process to a fintech company. A fintech can do it at pennies on the naira.Related NewsDangote refinery not enough for African market – FGTinubu, Shettima, Oyedele for CIBN banking conferenceNigeria targets $100bn investment commitments at summitHow does your company strike a balance between driving innovation and complying with regulations in Nigeria’s rapidly evolving fintech industry?Regulation makes operations easier. Because if you think about a totally unregulated space, that means anybody can do anything. And then if anybody can do anything, every single time the end user has a dispute. That dispute will end up in court, and it will be left to the courts to actually go ahead and decide who, what, and where. And that entire process is expensive and time-consuming. So, if you are a fintech, dealing with thousands of customers, and one per cent of them should sue you. What happens? So, when you have thoughtful regulation, it basically tells everybody what the guard rails are. It gives you the rules of the guard rails. And once you follow those guard rails, it is clear that only things that are outside those guard rails will cost you any peril. So, regulation does not stop innovation. It just lets you understand how you play.Although the economy has achieved some stability, challenges such as inflation and exchange rate volatility persist. What role can fintech companies play in helping businesses and consumers navigate these pressures?Fintechs have no power in this. They have no power to do anything about this. What they can do on their side is structure their business in such a way that depreciation of the naira and high interest rates do not affect them. On the other side, when you talk about their customers, what can they do to help their customers? Very little. Remember, fintechs are price takers when it comes to the funds that they facilitate the lending of, and when it comes to any deposits that they are able to attract. So, there is really not much that they can do.So, how can they help small businesses?It is just being able to continue to lend through that process. So, what you will find is banks get to a point where they say, because of the economic situation, we are going to wind down our books. And when they say they are going to wind down their books, all it means is that they are going to go out and call loans. What fintechs can do is, because they are iterative, they can continue to iterate price risk intelligently so that those banks that have partnered with them can continue to lend with confidence.Looking back over the past seven years, what would you consider Mathesis’s biggest achievements and milestones?In the last seven years, we have facilitated about 8.5 million loans, about $260m. We have facilitated lending to about 2.7 million individual borrowers. We have been able to go out and provide credit to people; the vast majority of our customers come to us through USSD, which is a group that has been severely underserved in Africa.What is your vision for Mathesis over the next decade?We live in a world where ten years is forever. Ten years is if you think back ten years, it is like going into the Stone Age. If we look at the next ten years, our goal is to be the major decision engine that handles any conversation where payment and fulfilment differ across Africa. And let me explain what that means. If I go out and I pay for a car, the man says he will bring the car in two weeks. There is risk in that. Our goal is that before you make that decision, you take that guy’s information, you are going to run it through us, and we will give you the probability that he will run away with the car. Then you can make an intelligent decision if you should give him the money for that. And it is the same thing in insurance. Somebody comes today when you go to buy insurance; they just give you one number. Everybody comes and says five per cent. You fight them and say it is 2.5 per cent. However, the two of you should never get to the same rate because if I dig into your life, I should be able to find out who you are and score that and do the same for you and score that. So, if I am the insurance company, I will say you are a proper man. You do not have issues. You do not owe anybody. And because you do not owe anybody, I think you will be a good risk. And I say to the other person and say your look is disturbing; you are a high risk. The goal is that we are there every time anybody wants to make a decision. Insurance, individual, real estate, banks, etc. We help you decide if you should take on that risk.How does Mathesis differ from traditional credit bureaus?So, credit bureaus are like the post office. So, every institution has a box. And inside that box, there are individuals in it. So, anytime the person does a transaction, you take it and put it in that box. And Nigeria’s credit bureau has become negative only. Which is, no matter what you do when you are paying, they do not bother; they do not bother going to put your name in the credit bureau. The day you do not pay, they are going to put your name in the credit bureau as a bad lender. So, what they do is mechanical. They are just collating data. Some of them are just selling scores, but the predictive value is pretty low. What we do is the predictive value side. We do not run around. That is not what we do. What we do is we work with institutions to take all the data that they currently have and give them an output that has real predictive value on how each particular borrower they take out of this pool works. How each particular person is most likely to behave. And again, there is no magic to it. Do some people who have high scores default? It happens. But if you look at it over time, over the population. We get it right more often than we get it wrong.The Minister of Finance recently argued that Nigeria’s rising public debt is largely a consequence of currency devaluation rather than new borrowing by the current administration. What is your assessment of that position?Does devaluation of currency make sense? Yes, it does. It does make sense because if you take the current exchange rate and apply it, if you go back five years and you take that exchange rate and apply it, you get a different number. So, is that part of it? I am sure it is. Now, is that all it is? Probably not. The good thing is the vast majority of our borrowing has been internal. So, it has been naira-based. You do not have to worry too much. Not that you do not have to worry about it, but at least it is serviceable. So, let us look at it this way. If they were going to borrow to buy this laptop three years ago, it would be X. If they try to buy this laptop today and they borrow money to do it, it would be five times that amount. So, as I said, what he said is true, but as with the finances of anybody’s house, the finances of the country are nuanced. So, making a proclamation, this is why it happened. No. It is probably not true. You have to look at the entire process. Well, if you say that is why it happened, and the question is, why did you not increase taxes here? So, there are so many levels. So, I personally tend not to listen to those things. Nine times out of ten, if I want to understand nuanced positions, I look for people that are speaking not from a political podium, but more from an academic podium because academics tend to just talk. They have nothing to lose. They have no agenda.Do you believe the naira has reached its fair market value?Given the level of growth that we are seeing in the country, I think long term if the growth levels do not get better, the naira is going to continue to depreciate. But given that now it is free floating, I think the pace of the depreciation would be quite low. And we will see spikes up as we go along the way. So, if you look at recent history when we had a managed process, the problem with the managed process is like you take a balloon, fill it with air, and you start squeezing it on one side. After you squeeze it, it will get to a point where it will just explode. That is those crazy devaluations we used to see. We are not going to see them going forward. I think until the level of growth increases, we are going to see general depreciation going forward.What is your outlook for the economy in the second half of the year?I think it will be no different from the first part. The only thing that concerns me is that everything that is going on in the Middle East is not getting better; it is getting worse. And if it continues to get worse, the price of energy will go up. And if the price of energy goes up, that is just going to flow into everything. So, inflation might get a little higher. So, but aside from that, I do not see anything. Everybody is looking forward to election spending, but the election spending is just going to help increase inflation. So, if there is one thing I expect for the next half year is probably a little bit of a tick-up in inflation. That is about it. I think fintechs are going to do something interesting, which is they are going to bring the banks closer to the individuals. What fintechs actually do is they help collect data that the bank currently does not hold, interpret that data, and provide it to the banks, and they now make intelligent decisions. At the end of the day, banks are very good at mobilising cheap deposits. They are also great at getting customers and depositors at scale. While fintechs are much better at iterating their processes and being quite innovative. So, both are going to come together and drive a significant improvement in services to current bank customers and open the doorway to bank a lot more of the unbanked people.What distinguishes your company from other fintech firms, and what unique solutions does it offer the market?What we do is analytics. The one thing we do is take data that our clients currently do not see as having any value in making decisions. We take all that data, we bring it together, and then we deliver it to our customers. We deliver to our customers the resources and suggestions on how to use those resources to make decisions. For now, most of our customers are banks, so they use those decisions to lend.You have advocated using data to help banks extend credit to the informal sector. Can you explain how this works and why you believe it can unlock more financing?Here is a way to look at it. If you think back fifteen years ago, the best kind of television was high definition. You had regular television and had high definition. Now, on regular television, you could see the pictures were pixelated. So, you can see the edge is not smooth. You can see those pixelations. My high-definition television is a lot smoother. That is kind of what we do. We take the data that is pixelated, and we help our customers, which are usually banks, to make that data smoother, so it is a better picture. So, if you look at our business from 2017 until now, we have done the equivalent of taking high definition to 8K. So, if you look at 8K, those pictures are basically lifelike.Why is that interesting? If you look at an unbanked person, it is like that old television, because the reason he is unbanked is not that he does not know where the bank is. It is because he does not see any value in talking to the banks because banks are just charging SMS fees and all sorts of fees. And that is only because the banks cannot see who he is. But when you put in technology, it makes it clear. Sometimes when you open a website, it will be all blurred, and all of a sudden it is clear. That is what we help the bank do because they see that blurry picture of an unbanked person. If you look at it through the lens of what Mathesis does, it now starts to take shape.Nigeria has several national databases, including the BVN, NIN and driver’s licence records. How can these data assets be leveraged to create economic value and unlock new financial opportunities?When I am trying to see how I can make this simple, because I am about to talk about it in mathematics. All this data, at the end of the day, some of them are just the same thing.BVN is your identity information based on banks. NIN is your general identification. The two of them are interchangeable. The driver’s licence is your identification based on the fact that you drive. The driver’s licence tells me something. It tells me that you know how to drive, and you might own a car. How do you turn all this into money? What you do is you take the data pools; with the BVN, I can see not just the individual, but I can see the economic value. In the NIN, what I would see there would be data that I can use to confirm BVNs. If I pull in your driver’s licence, in Nigeria the only thing it means is that you might own a car. Outside of Nigeria, if I pull in your driver’s licence, I also pull in your driving record, and what your driving record tells me is: are you someone that always speeds, or are you someone that has bad driving behaviour? Because if you have bad driving behaviour, you are probably going to be a bad borrower, because your driving record is your behaviour. And if we go back and look at what the things we talk about when we talk about lending are, it is the three things of lending: credit, character and collateral. If you are a bad driver, that means you are generally someone of questionable character. You take all these things, and you quantify them; you put them through an algorithm, and it will give you a score. And that score is a prediction of two things. It will predict, in some cases, how much you should lend that person, and it predicts the probability that that person will not pay you back. And that is how this whole thing becomes money. So, when you take those two scores and take them to a bank, a bank now looks at it and says, “Am I willing to take this risk?” Yes or no? If the bank says yes, all of a sudden you have created an economic event whereby the bank loans money to that person. Pays us a fee for what we do, and then the bank earns interest on that.The government has been pushing for a transition to a credit-driven economy, yet progress appears to have been slow. What do you think is holding back this transition?I think we have made some progress, but the goal that we have as a country will be achieved once the fintechs and the banks realise that they are all on the same side. Once they all realise that they are collaborators rather than competitors. Once they realise that, it opens up everything because at that point in time the banks do not have to go and look for somebody that is looking for a N5,000 loan because just doing the paperwork and the pen used in processing the loan is more than the N5,000 loan. So, what would they do? They will outsource that process to a fintech company. A fintech can do it at pennies on the naira.Related NewsDangote refinery not enough for African market – FGTinubu, Shettima, Oyedele for CIBN banking conferenceNigeria targets $100bn investment commitments at summitHow does your company strike a balance between driving innovation and complying with regulations in Nigeria’s rapidly evolving fintech industry?Regulation makes operations easier. Because if you think about a totally unregulated space, that means anybody can do anything. And then if anybody can do anything, every single time the end user has a dispute. That dispute will end up in court, and it will be left to the courts to actually go ahead and decide who, what, and where. And that entire process is expensive and time-consuming. So, if you are a fintech, dealing with thousands of customers, and one per cent of them should sue you. What happens? So, when you have thoughtful regulation, it basically tells everybody what the guard rails are. It gives you the rules of the guard rails. And once you follow those guard rails, it is clear that only things that are outside those guard rails will cost you any peril. So, regulation does not stop innovation. It just lets you understand how you play.Although the economy has achieved some stability, challenges such as inflation and exchange rate volatility persist. What role can fintech companies play in helping businesses and consumers navigate these pressures?Fintechs have no power in this. They have no power to do anything about this. What they can do on their side is structure their business in such a way that depreciation of the naira and high interest rates do not affect them. On the other side, when you talk about their customers, what can they do to help their customers? Very little. Remember, fintechs are price takers when it comes to the funds that they facilitate the lending of, and when it comes to any deposits that they are able to attract. So, there is really not much that they can do.So, how can they help small businesses?It is just being able to continue to lend through that process. So, what you will find is banks get to a point where they say, because of the economic situation, we are going to wind down our books. And when they say they are going to wind down their books, all it means is that they are going to go out and call loans. What fintechs can do is, because they are iterative, they can continue to iterate price risk intelligently so that those banks that have partnered with them can continue to lend with confidence.Looking back over the past seven years, what would you consider Mathesis’s biggest achievements and milestones?In the last seven years, we have facilitated about 8.5 million loans, about $260m. We have facilitated lending to about 2.7 million individual borrowers. We have been able to go out and provide credit to people; the vast majority of our customers come to us through USSD, which is a group that has been severely underserved in Africa.What is your vision for Mathesis over the next decade?We live in a world where ten years is forever. Ten years is if you think back ten years, it is like going into the Stone Age. If we look at the next ten years, our goal is to be the major decision engine that handles any conversation where payment and fulfilment differ across Africa. And let me explain what that means. If I go out and I pay for a car, the man says he will bring the car in two weeks. There is risk in that. Our goal is that before you make that decision, you take that guy’s information, you are going to run it through us, and we will give you the probability that he will run away with the car. Then you can make an intelligent decision if you should give him the money for that. And it is the same thing in insurance. Somebody comes today when you go to buy insurance; they just give you one number. Everybody comes and says five per cent. You fight them and say it is 2.5 per cent. However, the two of you should never get to the same rate because if I dig into your life, I should be able to find out who you are and score that and do the same for you and score that. So, if I am the insurance company, I will say you are a proper man. You do not have issues. You do not owe anybody. And because you do not owe anybody, I think you will be a good risk. And I say to the other person and say your look is disturbing; you are a high risk. The goal is that we are there every time anybody wants to make a decision. Insurance, individual, real estate, banks, etc. We help you decide if you should take on that risk.How does Mathesis differ from traditional credit bureaus?So, credit bureaus are like the post office. So, every institution has a box. And inside that box, there are individuals in it. So, anytime the person does a transaction, you take it and put it in that box. And Nigeria’s credit bureau has become negative only. Which is, no matter what you do when you are paying, they do not bother; they do not bother going to put your name in the credit bureau. The day you do not pay, they are going to put your name in the credit bureau as a bad lender. So, what they do is mechanical. They are just collating data. Some of them are just selling scores, but the predictive value is pretty low. What we do is the predictive value side. We do not run around. That is not what we do. What we do is we work with institutions to take all the data that they currently have and give them an output that has real predictive value on how each particular borrower they take out of this pool works. How each particular person is most likely to behave. And again, there is no magic to it. Do some people who have high scores default? It happens. But if you look at it over time, over the population. We get it right more often than we get it wrong.The Minister of Finance recently argued that Nigeria’s rising public debt is largely a consequence of currency devaluation rather than new borrowing by the current administration. What is your assessment of that position?Does devaluation of currency make sense? Yes, it does. It does make sense because if you take the current exchange rate and apply it, if you go back five years and you take that exchange rate and apply it, you get a different number. So, is that part of it? I am sure it is. Now, is that all it is? Probably not. The good thing is the vast majority of our borrowing has been internal. So, it has been naira-based. You do not have to worry too much. Not that you do not have to worry about it, but at least it is serviceable. So, let us look at it this way. If they were going to borrow to buy this laptop three years ago, it would be X. If they try to buy this laptop today and they borrow money to do it, it would be five times that amount. So, as I said, what he said is true, but as with the finances of anybody’s house, the finances of the country are nuanced. So, making a proclamation, this is why it happened. No. It is probably not true. You have to look at the entire process. Well, if you say that is why it happened, and the question is, why did you not increase taxes here? So, there are so many levels. So, I personally tend not to listen to those things. Nine times out of ten, if I want to understand nuanced positions, I look for people that are speaking not from a political podium, but more from an academic podium because academics tend to just talk. They have nothing to lose. They have no agenda.Do you believe the naira has reached its fair market value?Given the level of growth that we are seeing in the country, I think long term if the growth levels do not get better, the naira is going to continue to depreciate. But given that now it is free floating, I think the pace of the depreciation would be quite low. And we will see spikes up as we go along the way. So, if you look at recent history when we had a managed process, the problem with the managed process is like you take a balloon, fill it with air, and you start squeezing it on one side. After you squeeze it, it will get to a point where it will just explode. That is those crazy devaluations we used to see. We are not going to see them going forward. I think until the level of growth increases, we are going to see general depreciation going forward.What is your outlook for the economy in the second half of the year?I think it will be no different from the first part. The only thing that concerns me is that everything that is going on in the Middle East is not getting better; it is getting worse. And if it continues to get worse, the price of energy will go up. And if the price of energy goes up, that is just going to flow into everything. So, inflation might get a little higher. So, but aside from that, I do not see anything. Everybody is looking forward to election spending, but the election spending is just going to help increase inflation. So, if there is one thing I expect for the next half year is probably a little bit of a tick-up in inflation. That is about it. What distinguishes your company from other fintech firms, and what unique solutions does it offer the market?What we do is analytics. The one thing we do is take data that our clients currently do not see as having any value in making decisions. We take all that data, we bring it together, and then we deliver it to our customers. We deliver to our customers the resources and suggestions on how to use those resources to make decisions. For now, most of our customers are banks, so they use those decisions to lend.You have advocated using data to help banks extend credit to the informal sector. Can you explain how this works and why you believe it can unlock more financing?Here is a way to look at it. If you think back fifteen years ago, the best kind of television was high definition. You had regular television and had high definition. Now, on regular television, you could see the pictures were pixelated. So, you can see the edge is not smooth. You can see those pixelations. My high-definition television is a lot smoother. That is kind of what we do. We take the data that is pixelated, and we help our customers, which are usually banks, to make that data smoother, so it is a better picture. So, if you look at our business from 2017 until now, we have done the equivalent of taking high definition to 8K. So, if you look at 8K, those pictures are basically lifelike.Why is that interesting? If you look at an unbanked person, it is like that old television, because the reason he is unbanked is not that he does not know where the bank is. It is because he does not see any value in talking to the banks because banks are just charging SMS fees and all sorts of fees. And that is only because the banks cannot see who he is. But when you put in technology, it makes it clear. Sometimes when you open a website, it will be all blurred, and all of a sudden it is clear. That is what we help the bank do because they see that blurry picture of an unbanked person. If you look at it through the lens of what Mathesis does, it now starts to take shape.Nigeria has several national databases, including the BVN, NIN and driver’s licence records. How can these data assets be leveraged to create economic value and unlock new financial opportunities?When I am trying to see how I can make this simple, because I am about to talk about it in mathematics. All this data, at the end of the day, some of them are just the same thing.BVN is your identity information based on banks. NIN is your general identification. The two of them are interchangeable. The driver’s licence is your identification based on the fact that you drive. The driver’s licence tells me something. It tells me that you know how to drive, and you might own a car. How do you turn all this into money? What you do is you take the data pools; with the BVN, I can see not just the individual, but I can see the economic value. In the NIN, what I would see there would be data that I can use to confirm BVNs. If I pull in your driver’s licence, in Nigeria the only thing it means is that you might own a car. Outside of Nigeria, if I pull in your driver’s licence, I also pull in your driving record, and what your driving record tells me is: are you someone that always speeds, or are you someone that has bad driving behaviour? Because if you have bad driving behaviour, you are probably going to be a bad borrower, because your driving record is your behaviour. And if we go back and look at what the things we talk about when we talk about lending are, it is the three things of lending: credit, character and collateral. If you are a bad driver, that means you are generally someone of questionable character. You take all these things, and you quantify them; you put them through an algorithm, and it will give you a score. And that score is a prediction of two things. It will predict, in some cases, how much you should lend that person, and it predicts the probability that that person will not pay you back. And that is how this whole thing becomes money. So, when you take those two scores and take them to a bank, a bank now looks at it and says, “Am I willing to take this risk?” Yes or no? If the bank says yes, all of a sudden you have created an economic event whereby the bank loans money to that person. Pays us a fee for what we do, and then the bank earns interest on that.The government has been pushing for a transition to a credit-driven economy, yet progress appears to have been slow. What do you think is holding back this transition?I think we have made some progress, but the goal that we have as a country will be achieved once the fintechs and the banks realise that they are all on the same side. Once they all realise that they are collaborators rather than competitors. Once they realise that, it opens up everything because at that point in time the banks do not have to go and look for somebody that is looking for a N5,000 loan because just doing the paperwork and the pen used in processing the loan is more than the N5,000 loan. So, what would they do? They will outsource that process to a fintech company. A fintech can do it at pennies on the naira.Related NewsDangote refinery not enough for African market – FGTinubu, Shettima, Oyedele for CIBN banking conferenceNigeria targets $100bn investment commitments at summitHow does your company strike a balance between driving innovation and complying with regulations in Nigeria’s rapidly evolving fintech industry?Regulation makes operations easier. Because if you think about a totally unregulated space, that means anybody can do anything. And then if anybody can do anything, every single time the end user has a dispute. That dispute will end up in court, and it will be left to the courts to actually go ahead and decide who, what, and where. And that entire process is expensive and time-consuming. So, if you are a fintech, dealing with thousands of customers, and one per cent of them should sue you. What happens? So, when you have thoughtful regulation, it basically tells everybody what the guard rails are. It gives you the rules of the guard rails. And once you follow those guard rails, it is clear that only things that are outside those guard rails will cost you any peril. So, regulation does not stop innovation. It just lets you understand how you play.Although the economy has achieved some stability, challenges such as inflation and exchange rate volatility persist. What role can fintech companies play in helping businesses and consumers navigate these pressures?Fintechs have no power in this. They have no power to do anything about this. What they can do on their side is structure their business in such a way that depreciation of the naira and high interest rates do not affect them. On the other side, when you talk about their customers, what can they do to help their customers? Very little. Remember, fintechs are price takers when it comes to the funds that they facilitate the lending of, and when it comes to any deposits that they are able to attract. So, there is really not much that they can do.So, how can they help small businesses?It is just being able to continue to lend through that process. So, what you will find is banks get to a point where they say, because of the economic situation, we are going to wind down our books. And when they say they are going to wind down their books, all it means is that they are going to go out and call loans. What fintechs can do is, because they are iterative, they can continue to iterate price risk intelligently so that those banks that have partnered with them can continue to lend with confidence.Looking back over the past seven years, what would you consider Mathesis’s biggest achievements and milestones?In the last seven years, we have facilitated about 8.5 million loans, about $260m. We have facilitated lending to about 2.7 million individual borrowers. We have been able to go out and provide credit to people; the vast majority of our customers come to us through USSD, which is a group that has been severely underserved in Africa.What is your vision for Mathesis over the next decade?We live in a world where ten years is forever. Ten years is if you think back ten years, it is like going into the Stone Age. If we look at the next ten years, our goal is to be the major decision engine that handles any conversation where payment and fulfilment differ across Africa. And let me explain what that means. If I go out and I pay for a car, the man says he will bring the car in two weeks. There is risk in that. Our goal is that before you make that decision, you take that guy’s information, you are going to run it through us, and we will give you the probability that he will run away with the car. Then you can make an intelligent decision if you should give him the money for that. And it is the same thing in insurance. Somebody comes today when you go to buy insurance; they just give you one number. Everybody comes and says five per cent. You fight them and say it is 2.5 per cent. However, the two of you should never get to the same rate because if I dig into your life, I should be able to find out who you are and score that and do the same for you and score that. So, if I am the insurance company, I will say you are a proper man. You do not have issues. You do not owe anybody. And because you do not owe anybody, I think you will be a good risk. And I say to the other person and say your look is disturbing; you are a high risk. The goal is that we are there every time anybody wants to make a decision. Insurance, individual, real estate, banks, etc. We help you decide if you should take on that risk.How does Mathesis differ from traditional credit bureaus?So, credit bureaus are like the post office. So, every institution has a box. And inside that box, there are individuals in it. So, anytime the person does a transaction, you take it and put it in that box. And Nigeria’s credit bureau has become negative only. Which is, no matter what you do when you are paying, they do not bother; they do not bother going to put your name in the credit bureau. The day you do not pay, they are going to put your name in the credit bureau as a bad lender. So, what they do is mechanical. They are just collating data. Some of them are just selling scores, but the predictive value is pretty low. What we do is the predictive value side. We do not run around. That is not what we do. What we do is we work with institutions to take all the data that they currently have and give them an output that has real predictive value on how each particular borrower they take out of this pool works. How each particular person is most likely to behave. And again, there is no magic to it. Do some people who have high scores default? It happens. But if you look at it over time, over the population. We get it right more often than we get it wrong.The Minister of Finance recently argued that Nigeria’s rising public debt is largely a consequence of currency devaluation rather than new borrowing by the current administration. What is your assessment of that position?Does devaluation of currency make sense? Yes, it does. It does make sense because if you take the current exchange rate and apply it, if you go back five years and you take that exchange rate and apply it, you get a different number. So, is that part of it? I am sure it is. Now, is that all it is? Probably not. The good thing is the vast majority of our borrowing has been internal. So, it has been naira-based. You do not have to worry too much. Not that you do not have to worry about it, but at least it is serviceable. So, let us look at it this way. If they were going to borrow to buy this laptop three years ago, it would be X. If they try to buy this laptop today and they borrow money to do it, it would be five times that amount. So, as I said, what he said is true, but as with the finances of anybody’s house, the finances of the country are nuanced. So, making a proclamation, this is why it happened. No. It is probably not true. You have to look at the entire process. Well, if you say that is why it happened, and the question is, why did you not increase taxes here? So, there are so many levels. So, I personally tend not to listen to those things. Nine times out of ten, if I want to understand nuanced positions, I look for people that are speaking not from a political podium, but more from an academic podium because academics tend to just talk. They have nothing to lose. They have no agenda.Do you believe the naira has reached its fair market value?Given the level of growth that we are seeing in the country, I think long term if the growth levels do not get better, the naira is going to continue to depreciate. But given that now it is free floating, I think the pace of the depreciation would be quite low. And we will see spikes up as we go along the way. So, if you look at recent history when we had a managed process, the problem with the managed process is like you take a balloon, fill it with air, and you start squeezing it on one side. After you squeeze it, it will get to a point where it will just explode. That is those crazy devaluations we used to see. We are not going to see them going forward. I think until the level of growth increases, we are going to see general depreciation going forward.What is your outlook for the economy in the second half of the year?I think it will be no different from the first part. The only thing that concerns me is that everything that is going on in the Middle East is not getting better; it is getting worse. And if it continues to get worse, the price of energy will go up. And if the price of energy goes up, that is just going to flow into everything. So, inflation might get a little higher. So, but aside from that, I do not see anything. Everybody is looking forward to election spending, but the election spending is just going to help increase inflation. So, if there is one thing I expect for the next half year is probably a little bit of a tick-up in inflation. That is about it. What we do is analytics. The one thing we do is take data that our clients currently do not see as having any value in making decisions. We take all that data, we bring it together, and then we deliver it to our customers. We deliver to our customers the resources and suggestions on how to use those resources to make decisions. For now, most of our customers are banks, so they use those decisions to lend.You have advocated using data to help banks extend credit to the informal sector. Can you explain how this works and why you believe it can unlock more financing?Here is a way to look at it. If you think back fifteen years ago, the best kind of television was high definition. You had regular television and had high definition. Now, on regular television, you could see the pictures were pixelated. So, you can see the edge is not smooth. You can see those pixelations. My high-definition television is a lot smoother. That is kind of what we do. We take the data that is pixelated, and we help our customers, which are usually banks, to make that data smoother, so it is a better picture. So, if you look at our business from 2017 until now, we have done the equivalent of taking high definition to 8K. So, if you look at 8K, those pictures are basically lifelike.Why is that interesting? If you look at an unbanked person, it is like that old television, because the reason he is unbanked is not that he does not know where the bank is. It is because he does not see any value in talking to the banks because banks are just charging SMS fees and all sorts of fees. And that is only because the banks cannot see who he is. But when you put in technology, it makes it clear. Sometimes when you open a website, it will be all blurred, and all of a sudden it is clear. That is what we help the bank do because they see that blurry picture of an unbanked person. If you look at it through the lens of what Mathesis does, it now starts to take shape.Nigeria has several national databases, including the BVN, NIN and driver’s licence records. How can these data assets be leveraged to create economic value and unlock new financial opportunities?When I am trying to see how I can make this simple, because I am about to talk about it in mathematics. All this data, at the end of the day, some of them are just the same thing.BVN is your identity information based on banks. NIN is your general identification. The two of them are interchangeable. The driver’s licence is your identification based on the fact that you drive. The driver’s licence tells me something. It tells me that you know how to drive, and you might own a car. How do you turn all this into money? What you do is you take the data pools; with the BVN, I can see not just the individual, but I can see the economic value. In the NIN, what I would see there would be data that I can use to confirm BVNs. If I pull in your driver’s licence, in Nigeria the only thing it means is that you might own a car. Outside of Nigeria, if I pull in your driver’s licence, I also pull in your driving record, and what your driving record tells me is: are you someone that always speeds, or are you someone that has bad driving behaviour? Because if you have bad driving behaviour, you are probably going to be a bad borrower, because your driving record is your behaviour. And if we go back and look at what the things we talk about when we talk about lending are, it is the three things of lending: credit, character and collateral. If you are a bad driver, that means you are generally someone of questionable character. You take all these things, and you quantify them; you put them through an algorithm, and it will give you a score. And that score is a prediction of two things. It will predict, in some cases, how much you should lend that person, and it predicts the probability that that person will not pay you back. And that is how this whole thing becomes money. So, when you take those two scores and take them to a bank, a bank now looks at it and says, “Am I willing to take this risk?” Yes or no? If the bank says yes, all of a sudden you have created an economic event whereby the bank loans money to that person. Pays us a fee for what we do, and then the bank earns interest on that.The government has been pushing for a transition to a credit-driven economy, yet progress appears to have been slow. What do you think is holding back this transition?I think we have made some progress, but the goal that we have as a country will be achieved once the fintechs and the banks realise that they are all on the same side. Once they all realise that they are collaborators rather than competitors. Once they realise that, it opens up everything because at that point in time the banks do not have to go and look for somebody that is looking for a N5,000 loan because just doing the paperwork and the pen used in processing the loan is more than the N5,000 loan. So, what would they do? They will outsource that process to a fintech company. A fintech can do it at pennies on the naira.Related NewsDangote refinery not enough for African market – FGTinubu, Shettima, Oyedele for CIBN banking conferenceNigeria targets $100bn investment commitments at summitHow does your company strike a balance between driving innovation and complying with regulations in Nigeria’s rapidly evolving fintech industry?Regulation makes operations easier. Because if you think about a totally unregulated space, that means anybody can do anything. And then if anybody can do anything, every single time the end user has a dispute. That dispute will end up in court, and it will be left to the courts to actually go ahead and decide who, what, and where. And that entire process is expensive and time-consuming. So, if you are a fintech, dealing with thousands of customers, and one per cent of them should sue you. What happens? So, when you have thoughtful regulation, it basically tells everybody what the guard rails are. It gives you the rules of the guard rails. And once you follow those guard rails, it is clear that only things that are outside those guard rails will cost you any peril. So, regulation does not stop innovation. It just lets you understand how you play.Although the economy has achieved some stability, challenges such as inflation and exchange rate volatility persist. What role can fintech companies play in helping businesses and consumers navigate these pressures?Fintechs have no power in this. They have no power to do anything about this. What they can do on their side is structure their business in such a way that depreciation of the naira and high interest rates do not affect them. On the other side, when you talk about their customers, what can they do to help their customers? Very little. Remember, fintechs are price takers when it comes to the funds that they facilitate the lending of, and when it comes to any deposits that they are able to attract. So, there is really not much that they can do.So, how can they help small businesses?It is just being able to continue to lend through that process. So, what you will find is banks get to a point where they say, because of the economic situation, we are going to wind down our books. And when they say they are going to wind down their books, all it means is that they are going to go out and call loans. What fintechs can do is, because they are iterative, they can continue to iterate price risk intelligently so that those banks that have partnered with them can continue to lend with confidence.Looking back over the past seven years, what would you consider Mathesis’s biggest achievements and milestones?In the last seven years, we have facilitated about 8.5 million loans, about $260m. We have facilitated lending to about 2.7 million individual borrowers. We have been able to go out and provide credit to people; the vast majority of our customers come to us through USSD, which is a group that has been severely underserved in Africa.What is your vision for Mathesis over the next decade?We live in a world where ten years is forever. Ten years is if you think back ten years, it is like going into the Stone Age. If we look at the next ten years, our goal is to be the major decision engine that handles any conversation where payment and fulfilment differ across Africa. And let me explain what that means. If I go out and I pay for a car, the man says he will bring the car in two weeks. There is risk in that. Our goal is that before you make that decision, you take that guy’s information, you are going to run it through us, and we will give you the probability that he will run away with the car. Then you can make an intelligent decision if you should give him the money for that. And it is the same thing in insurance. Somebody comes today when you go to buy insurance; they just give you one number. Everybody comes and says five per cent. You fight them and say it is 2.5 per cent. However, the two of you should never get to the same rate because if I dig into your life, I should be able to find out who you are and score that and do the same for you and score that. So, if I am the insurance company, I will say you are a proper man. You do not have issues. You do not owe anybody. And because you do not owe anybody, I think you will be a good risk. And I say to the other person and say your look is disturbing; you are a high risk. The goal is that we are there every time anybody wants to make a decision. Insurance, individual, real estate, banks, etc. We help you decide if you should take on that risk.How does Mathesis differ from traditional credit bureaus?So, credit bureaus are like the post office. So, every institution has a box. And inside that box, there are individuals in it. So, anytime the person does a transaction, you take it and put it in that box. And Nigeria’s credit bureau has become negative only. Which is, no matter what you do when you are paying, they do not bother; they do not bother going to put your name in the credit bureau. The day you do not pay, they are going to put your name in the credit bureau as a bad lender. So, what they do is mechanical. They are just collating data. Some of them are just selling scores, but the predictive value is pretty low. What we do is the predictive value side. We do not run around. That is not what we do. What we do is we work with institutions to take all the data that they currently have and give them an output that has real predictive value on how each particular borrower they take out of this pool works. How each particular person is most likely to behave. And again, there is no magic to it. Do some people who have high scores default? It happens. But if you look at it over time, over the population. We get it right more often than we get it wrong.The Minister of Finance recently argued that Nigeria’s rising public debt is largely a consequence of currency devaluation rather than new borrowing by the current administration. What is your assessment of that position?Does devaluation of currency make sense? Yes, it does. It does make sense because if you take the current exchange rate and apply it, if you go back five years and you take that exchange rate and apply it, you get a different number. So, is that part of it? I am sure it is. Now, is that all it is? Probably not. The good thing is the vast majority of our borrowing has been internal. So, it has been naira-based. You do not have to worry too much. Not that you do not have to worry about it, but at least it is serviceable. So, let us look at it this way. If they were going to borrow to buy this laptop three years ago, it would be X. If they try to buy this laptop today and they borrow money to do it, it would be five times that amount. So, as I said, what he said is true, but as with the finances of anybody’s house, the finances of the country are nuanced. So, making a proclamation, this is why it happened. No. It is probably not true. You have to look at the entire process. Well, if you say that is why it happened, and the question is, why did you not increase taxes here? So, there are so many levels. So, I personally tend not to listen to those things. Nine times out of ten, if I want to understand nuanced positions, I look for people that are speaking not from a political podium, but more from an academic podium because academics tend to just talk. They have nothing to lose. They have no agenda.Do you believe the naira has reached its fair market value?Given the level of growth that we are seeing in the country, I think long term if the growth levels do not get better, the naira is going to continue to depreciate. But given that now it is free floating, I think the pace of the depreciation would be quite low. And we will see spikes up as we go along the way. So, if you look at recent history when we had a managed process, the problem with the managed process is like you take a balloon, fill it with air, and you start squeezing it on one side. After you squeeze it, it will get to a point where it will just explode. That is those crazy devaluations we used to see. We are not going to see them going forward. I think until the level of growth increases, we are going to see general depreciation going forward.What is your outlook for the economy in the second half of the year?I think it will be no different from the first part. The only thing that concerns me is that everything that is going on in the Middle East is not getting better; it is getting worse. And if it continues to get worse, the price of energy will go up. And if the price of energy goes up, that is just going to flow into everything. So, inflation might get a little higher. So, but aside from that, I do not see anything. Everybody is looking forward to election spending, but the election spending is just going to help increase inflation. So, if there is one thing I expect for the next half year is probably a little bit of a tick-up in inflation. That is about it. You have advocated using data to help banks extend credit to the informal sector. Can you explain how this works and why you believe it can unlock more financing?Here is a way to look at it. If you think back fifteen years ago, the best kind of television was high definition. You had regular television and had high definition. Now, on regular television, you could see the pictures were pixelated. So, you can see the edge is not smooth. You can see those pixelations. My high-definition television is a lot smoother. That is kind of what we do. We take the data that is pixelated, and we help our customers, which are usually banks, to make that data smoother, so it is a better picture. So, if you look at our business from 2017 until now, we have done the equivalent of taking high definition to 8K. So, if you look at 8K, those pictures are basically lifelike.Why is that interesting? If you look at an unbanked person, it is like that old television, because the reason he is unbanked is not that he does not know where the bank is. It is because he does not see any value in talking to the banks because banks are just charging SMS fees and all sorts of fees. And that is only because the banks cannot see who he is. But when you put in technology, it makes it clear. Sometimes when you open a website, it will be all blurred, and all of a sudden it is clear. That is what we help the bank do because they see that blurry picture of an unbanked person. If you look at it through the lens of what Mathesis does, it now starts to take shape.Nigeria has several national databases, including the BVN, NIN and driver’s licence records. How can these data assets be leveraged to create economic value and unlock new financial opportunities?When I am trying to see how I can make this simple, because I am about to talk about it in mathematics. All this data, at the end of the day, some of them are just the same thing.BVN is your identity information based on banks. NIN is your general identification. The two of them are interchangeable. The driver’s licence is your identification based on the fact that you drive. The driver’s licence tells me something. It tells me that you know how to drive, and you might own a car. How do you turn all this into money? What you do is you take the data pools; with the BVN, I can see not just the individual, but I can see the economic value. In the NIN, what I would see there would be data that I can use to confirm BVNs. If I pull in your driver’s licence, in Nigeria the only thing it means is that you might own a car. Outside of Nigeria, if I pull in your driver’s licence, I also pull in your driving record, and what your driving record tells me is: are you someone that always speeds, or are you someone that has bad driving behaviour? Because if you have bad driving behaviour, you are probably going to be a bad borrower, because your driving record is your behaviour. And if we go back and look at what the things we talk about when we talk about lending are, it is the three things of lending: credit, character and collateral. If you are a bad driver, that means you are generally someone of questionable character. You take all these things, and you quantify them; you put them through an algorithm, and it will give you a score. And that score is a prediction of two things. It will predict, in some cases, how much you should lend that person, and it predicts the probability that that person will not pay you back. And that is how this whole thing becomes money. So, when you take those two scores and take them to a bank, a bank now looks at it and says, “Am I willing to take this risk?” Yes or no? If the bank says yes, all of a sudden you have created an economic event whereby the bank loans money to that person. Pays us a fee for what we do, and then the bank earns interest on that.The government has been pushing for a transition to a credit-driven economy, yet progress appears to have been slow. What do you think is holding back this transition?I think we have made some progress, but the goal that we have as a country will be achieved once the fintechs and the banks realise that they are all on the same side. Once they all realise that they are collaborators rather than competitors. Once they realise that, it opens up everything because at that point in time the banks do not have to go and look for somebody that is looking for a N5,000 loan because just doing the paperwork and the pen used in processing the loan is more than the N5,000 loan. So, what would they do? They will outsource that process to a fintech company. A fintech can do it at pennies on the naira.Related NewsDangote refinery not enough for African market – FGTinubu, Shettima, Oyedele for CIBN banking conferenceNigeria targets $100bn investment commitments at summitHow does your company strike a balance between driving innovation and complying with regulations in Nigeria’s rapidly evolving fintech industry?Regulation makes operations easier. Because if you think about a totally unregulated space, that means anybody can do anything. And then if anybody can do anything, every single time the end user has a dispute. That dispute will end up in court, and it will be left to the courts to actually go ahead and decide who, what, and where. And that entire process is expensive and time-consuming. So, if you are a fintech, dealing with thousands of customers, and one per cent of them should sue you. What happens? So, when you have thoughtful regulation, it basically tells everybody what the guard rails are. It gives you the rules of the guard rails. And once you follow those guard rails, it is clear that only things that are outside those guard rails will cost you any peril. So, regulation does not stop innovation. It just lets you understand how you play.Although the economy has achieved some stability, challenges such as inflation and exchange rate volatility persist. What role can fintech companies play in helping businesses and consumers navigate these pressures?Fintechs have no power in this. They have no power to do anything about this. What they can do on their side is structure their business in such a way that depreciation of the naira and high interest rates do not affect them. On the other side, when you talk about their customers, what can they do to help their customers? Very little. Remember, fintechs are price takers when it comes to the funds that they facilitate the lending of, and when it comes to any deposits that they are able to attract. So, there is really not much that they can do.So, how can they help small businesses?It is just being able to continue to lend through that process. So, what you will find is banks get to a point where they say, because of the economic situation, we are going to wind down our books. And when they say they are going to wind down their books, all it means is that they are going to go out and call loans. What fintechs can do is, because they are iterative, they can continue to iterate price risk intelligently so that those banks that have partnered with them can continue to lend with confidence.Looking back over the past seven years, what would you consider Mathesis’s biggest achievements and milestones?In the last seven years, we have facilitated about 8.5 million loans, about $260m. We have facilitated lending to about 2.7 million individual borrowers. We have been able to go out and provide credit to people; the vast majority of our customers come to us through USSD, which is a group that has been severely underserved in Africa.What is your vision for Mathesis over the next decade?We live in a world where ten years is forever. Ten years is if you think back ten years, it is like going into the Stone Age. If we look at the next ten years, our goal is to be the major decision engine that handles any conversation where payment and fulfilment differ across Africa. And let me explain what that means. If I go out and I pay for a car, the man says he will bring the car in two weeks. There is risk in that. Our goal is that before you make that decision, you take that guy’s information, you are going to run it through us, and we will give you the probability that he will run away with the car. Then you can make an intelligent decision if you should give him the money for that. And it is the same thing in insurance. Somebody comes today when you go to buy insurance; they just give you one number. Everybody comes and says five per cent. You fight them and say it is 2.5 per cent. However, the two of you should never get to the same rate because if I dig into your life, I should be able to find out who you are and score that and do the same for you and score that. So, if I am the insurance company, I will say you are a proper man. You do not have issues. You do not owe anybody. And because you do not owe anybody, I think you will be a good risk. And I say to the other person and say your look is disturbing; you are a high risk. The goal is that we are there every time anybody wants to make a decision. Insurance, individual, real estate, banks, etc. We help you decide if you should take on that risk.How does Mathesis differ from traditional credit bureaus?So, credit bureaus are like the post office. So, every institution has a box. And inside that box, there are individuals in it. So, anytime the person does a transaction, you take it and put it in that box. And Nigeria’s credit bureau has become negative only. Which is, no matter what you do when you are paying, they do not bother; they do not bother going to put your name in the credit bureau. The day you do not pay, they are going to put your name in the credit bureau as a bad lender. So, what they do is mechanical. They are just collating data. Some of them are just selling scores, but the predictive value is pretty low. What we do is the predictive value side. We do not run around. That is not what we do. What we do is we work with institutions to take all the data that they currently have and give them an output that has real predictive value on how each particular borrower they take out of this pool works. How each particular person is most likely to behave. And again, there is no magic to it. Do some people who have high scores default? It happens. But if you look at it over time, over the population. We get it right more often than we get it wrong.The Minister of Finance recently argued that Nigeria’s rising public debt is largely a consequence of currency devaluation rather than new borrowing by the current administration. What is your assessment of that position?Does devaluation of currency make sense? Yes, it does. It does make sense because if you take the current exchange rate and apply it, if you go back five years and you take that exchange rate and apply it, you get a different number. So, is that part of it? I am sure it is. Now, is that all it is? Probably not. The good thing is the vast majority of our borrowing has been internal. So, it has been naira-based. You do not have to worry too much. Not that you do not have to worry about it, but at least it is serviceable. So, let us look at it this way. If they were going to borrow to buy this laptop three years ago, it would be X. If they try to buy this laptop today and they borrow money to do it, it would be five times that amount. So, as I said, what he said is true, but as with the finances of anybody’s house, the finances of the country are nuanced. So, making a proclamation, this is why it happened. No. It is probably not true. You have to look at the entire process. Well, if you say that is why it happened, and the question is, why did you not increase taxes here? So, there are so many levels. So, I personally tend not to listen to those things. Nine times out of ten, if I want to understand nuanced positions, I look for people that are speaking not from a political podium, but more from an academic podium because academics tend to just talk. They have nothing to lose. They have no agenda.Do you believe the naira has reached its fair market value?Given the level of growth that we are seeing in the country, I think long term if the growth levels do not get better, the naira is going to continue to depreciate. But given that now it is free floating, I think the pace of the depreciation would be quite low. And we will see spikes up as we go along the way. So, if you look at recent history when we had a managed process, the problem with the managed process is like you take a balloon, fill it with air, and you start squeezing it on one side. After you squeeze it, it will get to a point where it will just explode. That is those crazy devaluations we used to see. We are not going to see them going forward. I think until the level of growth increases, we are going to see general depreciation going forward.What is your outlook for the economy in the second half of the year?I think it will be no different from the first part. The only thing that concerns me is that everything that is going on in the Middle East is not getting better; it is getting worse. And if it continues to get worse, the price of energy will go up. And if the price of energy goes up, that is just going to flow into everything. So, inflation might get a little higher. So, but aside from that, I do not see anything. Everybody is looking forward to election spending, but the election spending is just going to help increase inflation. So, if there is one thing I expect for the next half year is probably a little bit of a tick-up in inflation. That is about it. Here is a way to look at it. If you think back fifteen years ago, the best kind of television was high definition. You had regular television and had high definition. Now, on regular television, you could see the pictures were pixelated. So, you can see the edge is not smooth. You can see those pixelations. My high-definition television is a lot smoother. That is kind of what we do. We take the data that is pixelated, and we help our customers, which are usually banks, to make that data smoother, so it is a better picture. So, if you look at our business from 2017 until now, we have done the equivalent of taking high definition to 8K. So, if you look at 8K, those pictures are basically lifelike.Why is that interesting? If you look at an unbanked person, it is like that old television, because the reason he is unbanked is not that he does not know where the bank is. It is because he does not see any value in talking to the banks because banks are just charging SMS fees and all sorts of fees. And that is only because the banks cannot see who he is. But when you put in technology, it makes it clear. Sometimes when you open a website, it will be all blurred, and all of a sudden it is clear. That is what we help the bank do because they see that blurry picture of an unbanked person. If you look at it through the lens of what Mathesis does, it now starts to take shape.Nigeria has several national databases, including the BVN, NIN and driver’s licence records. How can these data assets be leveraged to create economic value and unlock new financial opportunities?When I am trying to see how I can make this simple, because I am about to talk about it in mathematics. All this data, at the end of the day, some of them are just the same thing.BVN is your identity information based on banks. NIN is your general identification. The two of them are interchangeable. The driver’s licence is your identification based on the fact that you drive. The driver’s licence tells me something. It tells me that you know how to drive, and you might own a car. How do you turn all this into money? What you do is you take the data pools; with the BVN, I can see not just the individual, but I can see the economic value. In the NIN, what I would see there would be data that I can use to confirm BVNs. If I pull in your driver’s licence, in Nigeria the only thing it means is that you might own a car. Outside of Nigeria, if I pull in your driver’s licence, I also pull in your driving record, and what your driving record tells me is: are you someone that always speeds, or are you someone that has bad driving behaviour? Because if you have bad driving behaviour, you are probably going to be a bad borrower, because your driving record is your behaviour. And if we go back and look at what the things we talk about when we talk about lending are, it is the three things of lending: credit, character and collateral. If you are a bad driver, that means you are generally someone of questionable character. You take all these things, and you quantify them; you put them through an algorithm, and it will give you a score. And that score is a prediction of two things. It will predict, in some cases, how much you should lend that person, and it predicts the probability that that person will not pay you back. And that is how this whole thing becomes money. So, when you take those two scores and take them to a bank, a bank now looks at it and says, “Am I willing to take this risk?” Yes or no? If the bank says yes, all of a sudden you have created an economic event whereby the bank loans money to that person. Pays us a fee for what we do, and then the bank earns interest on that.The government has been pushing for a transition to a credit-driven economy, yet progress appears to have been slow. What do you think is holding back this transition?I think we have made some progress, but the goal that we have as a country will be achieved once the fintechs and the banks realise that they are all on the same side. Once they all realise that they are collaborators rather than competitors. Once they realise that, it opens up everything because at that point in time the banks do not have to go and look for somebody that is looking for a N5,000 loan because just doing the paperwork and the pen used in processing the loan is more than the N5,000 loan. So, what would they do? They will outsource that process to a fintech company. A fintech can do it at pennies on the naira.Related NewsDangote refinery not enough for African market – FGTinubu, Shettima, Oyedele for CIBN banking conferenceNigeria targets $100bn investment commitments at summitHow does your company strike a balance between driving innovation and complying with regulations in Nigeria’s rapidly evolving fintech industry?Regulation makes operations easier. Because if you think about a totally unregulated space, that means anybody can do anything. And then if anybody can do anything, every single time the end user has a dispute. That dispute will end up in court, and it will be left to the courts to actually go ahead and decide who, what, and where. And that entire process is expensive and time-consuming. So, if you are a fintech, dealing with thousands of customers, and one per cent of them should sue you. What happens? So, when you have thoughtful regulation, it basically tells everybody what the guard rails are. It gives you the rules of the guard rails. And once you follow those guard rails, it is clear that only things that are outside those guard rails will cost you any peril. So, regulation does not stop innovation. It just lets you understand how you play.Although the economy has achieved some stability, challenges such as inflation and exchange rate volatility persist. What role can fintech companies play in helping businesses and consumers navigate these pressures?Fintechs have no power in this. They have no power to do anything about this. What they can do on their side is structure their business in such a way that depreciation of the naira and high interest rates do not affect them. On the other side, when you talk about their customers, what can they do to help their customers? Very little. Remember, fintechs are price takers when it comes to the funds that they facilitate the lending of, and when it comes to any deposits that they are able to attract. So, there is really not much that they can do.So, how can they help small businesses?It is just being able to continue to lend through that process. So, what you will find is banks get to a point where they say, because of the economic situation, we are going to wind down our books. And when they say they are going to wind down their books, all it means is that they are going to go out and call loans. What fintechs can do is, because they are iterative, they can continue to iterate price risk intelligently so that those banks that have partnered with them can continue to lend with confidence.Looking back over the past seven years, what would you consider Mathesis’s biggest achievements and milestones?In the last seven years, we have facilitated about 8.5 million loans, about $260m. We have facilitated lending to about 2.7 million individual borrowers. We have been able to go out and provide credit to people; the vast majority of our customers come to us through USSD, which is a group that has been severely underserved in Africa.What is your vision for Mathesis over the next decade?We live in a world where ten years is forever. Ten years is if you think back ten years, it is like going into the Stone Age. If we look at the next ten years, our goal is to be the major decision engine that handles any conversation where payment and fulfilment differ across Africa. And let me explain what that means. If I go out and I pay for a car, the man says he will bring the car in two weeks. There is risk in that. Our goal is that before you make that decision, you take that guy’s information, you are going to run it through us, and we will give you the probability that he will run away with the car. Then you can make an intelligent decision if you should give him the money for that. And it is the same thing in insurance. Somebody comes today when you go to buy insurance; they just give you one number. Everybody comes and says five per cent. You fight them and say it is 2.5 per cent. However, the two of you should never get to the same rate because if I dig into your life, I should be able to find out who you are and score that and do the same for you and score that. So, if I am the insurance company, I will say you are a proper man. You do not have issues. You do not owe anybody. And because you do not owe anybody, I think you will be a good risk. And I say to the other person and say your look is disturbing; you are a high risk. The goal is that we are there every time anybody wants to make a decision. Insurance, individual, real estate, banks, etc. We help you decide if you should take on that risk.How does Mathesis differ from traditional credit bureaus?So, credit bureaus are like the post office. So, every institution has a box. And inside that box, there are individuals in it. So, anytime the person does a transaction, you take it and put it in that box. And Nigeria’s credit bureau has become negative only. Which is, no matter what you do when you are paying, they do not bother; they do not bother going to put your name in the credit bureau. The day you do not pay, they are going to put your name in the credit bureau as a bad lender. So, what they do is mechanical. They are just collating data. Some of them are just selling scores, but the predictive value is pretty low. What we do is the predictive value side. We do not run around. That is not what we do. What we do is we work with institutions to take all the data that they currently have and give them an output that has real predictive value on how each particular borrower they take out of this pool works. How each particular person is most likely to behave. And again, there is no magic to it. Do some people who have high scores default? It happens. But if you look at it over time, over the population. We get it right more often than we get it wrong.The Minister of Finance recently argued that Nigeria’s rising public debt is largely a consequence of currency devaluation rather than new borrowing by the current administration. What is your assessment of that position?Does devaluation of currency make sense? Yes, it does. It does make sense because if you take the current exchange rate and apply it, if you go back five years and you take that exchange rate and apply it, you get a different number. So, is that part of it? I am sure it is. Now, is that all it is? Probably not. The good thing is the vast majority of our borrowing has been internal. So, it has been naira-based. You do not have to worry too much. Not that you do not have to worry about it, but at least it is serviceable. So, let us look at it this way. If they were going to borrow to buy this laptop three years ago, it would be X. If they try to buy this laptop today and they borrow money to do it, it would be five times that amount. So, as I said, what he said is true, but as with the finances of anybody’s house, the finances of the country are nuanced. So, making a proclamation, this is why it happened. No. It is probably not true. You have to look at the entire process. Well, if you say that is why it happened, and the question is, why did you not increase taxes here? So, there are so many levels. So, I personally tend not to listen to those things. Nine times out of ten, if I want to understand nuanced positions, I look for people that are speaking not from a political podium, but more from an academic podium because academics tend to just talk. They have nothing to lose. They have no agenda.Do you believe the naira has reached its fair market value?Given the level of growth that we are seeing in the country, I think long term if the growth levels do not get better, the naira is going to continue to depreciate. But given that now it is free floating, I think the pace of the depreciation would be quite low. And we will see spikes up as we go along the way. So, if you look at recent history when we had a managed process, the problem with the managed process is like you take a balloon, fill it with air, and you start squeezing it on one side. After you squeeze it, it will get to a point where it will just explode. That is those crazy devaluations we used to see. We are not going to see them going forward. I think until the level of growth increases, we are going to see general depreciation going forward.What is your outlook for the economy in the second half of the year?I think it will be no different from the first part. The only thing that concerns me is that everything that is going on in the Middle East is not getting better; it is getting worse. And if it continues to get worse, the price of energy will go up. And if the price of energy goes up, that is just going to flow into everything. So, inflation might get a little higher. So, but aside from that, I do not see anything. Everybody is looking forward to election spending, but the election spending is just going to help increase inflation. So, if there is one thing I expect for the next half year is probably a little bit of a tick-up in inflation. That is about it. Why is that interesting? If you look at an unbanked person, it is like that old television, because the reason he is unbanked is not that he does not know where the bank is. It is because he does not see any value in talking to the banks because banks are just charging SMS fees and all sorts of fees. And that is only because the banks cannot see who he is. But when you put in technology, it makes it clear. Sometimes when you open a website, it will be all blurred, and all of a sudden it is clear. That is what we help the bank do because they see that blurry picture of an unbanked person. If you look at it through the lens of what Mathesis does, it now starts to take shape.Nigeria has several national databases, including the BVN, NIN and driver’s licence records. How can these data assets be leveraged to create economic value and unlock new financial opportunities?When I am trying to see how I can make this simple, because I am about to talk about it in mathematics. All this data, at the end of the day, some of them are just the same thing.BVN is your identity information based on banks. NIN is your general identification. The two of them are interchangeable. The driver’s licence is your identification based on the fact that you drive. The driver’s licence tells me something. It tells me that you know how to drive, and you might own a car. How do you turn all this into money? What you do is you take the data pools; with the BVN, I can see not just the individual, but I can see the economic value. In the NIN, what I would see there would be data that I can use to confirm BVNs. If I pull in your driver’s licence, in Nigeria the only thing it means is that you might own a car. Outside of Nigeria, if I pull in your driver’s licence, I also pull in your driving record, and what your driving record tells me is: are you someone that always speeds, or are you someone that has bad driving behaviour? Because if you have bad driving behaviour, you are probably going to be a bad borrower, because your driving record is your behaviour. And if we go back and look at what the things we talk about when we talk about lending are, it is the three things of lending: credit, character and collateral. If you are a bad driver, that means you are generally someone of questionable character. You take all these things, and you quantify them; you put them through an algorithm, and it will give you a score. And that score is a prediction of two things. It will predict, in some cases, how much you should lend that person, and it predicts the probability that that person will not pay you back. And that is how this whole thing becomes money. So, when you take those two scores and take them to a bank, a bank now looks at it and says, “Am I willing to take this risk?” Yes or no? If the bank says yes, all of a sudden you have created an economic event whereby the bank loans money to that person. Pays us a fee for what we do, and then the bank earns interest on that.The government has been pushing for a transition to a credit-driven economy, yet progress appears to have been slow. What do you think is holding back this transition?I think we have made some progress, but the goal that we have as a country will be achieved once the fintechs and the banks realise that they are all on the same side. Once they all realise that they are collaborators rather than competitors. Once they realise that, it opens up everything because at that point in time the banks do not have to go and look for somebody that is looking for a N5,000 loan because just doing the paperwork and the pen used in processing the loan is more than the N5,000 loan. So, what would they do? They will outsource that process to a fintech company. A fintech can do it at pennies on the naira.Related NewsDangote refinery not enough for African market – FGTinubu, Shettima, Oyedele for CIBN banking conferenceNigeria targets $100bn investment commitments at summitHow does your company strike a balance between driving innovation and complying with regulations in Nigeria’s rapidly evolving fintech industry?Regulation makes operations easier. Because if you think about a totally unregulated space, that means anybody can do anything. And then if anybody can do anything, every single time the end user has a dispute. That dispute will end up in court, and it will be left to the courts to actually go ahead and decide who, what, and where. And that entire process is expensive and time-consuming. So, if you are a fintech, dealing with thousands of customers, and one per cent of them should sue you. What happens? So, when you have thoughtful regulation, it basically tells everybody what the guard rails are. It gives you the rules of the guard rails. And once you follow those guard rails, it is clear that only things that are outside those guard rails will cost you any peril. So, regulation does not stop innovation. It just lets you understand how you play.Although the economy has achieved some stability, challenges such as inflation and exchange rate volatility persist. What role can fintech companies play in helping businesses and consumers navigate these pressures?Fintechs have no power in this. They have no power to do anything about this. What they can do on their side is structure their business in such a way that depreciation of the naira and high interest rates do not affect them. On the other side, when you talk about their customers, what can they do to help their customers? Very little. Remember, fintechs are price takers when it comes to the funds that they facilitate the lending of, and when it comes to any deposits that they are able to attract. So, there is really not much that they can do.So, how can they help small businesses?It is just being able to continue to lend through that process. So, what you will find is banks get to a point where they say, because of the economic situation, we are going to wind down our books. And when they say they are going to wind down their books, all it means is that they are going to go out and call loans. What fintechs can do is, because they are iterative, they can continue to iterate price risk intelligently so that those banks that have partnered with them can continue to lend with confidence.Looking back over the past seven years, what would you consider Mathesis’s biggest achievements and milestones?In the last seven years, we have facilitated about 8.5 million loans, about $260m. We have facilitated lending to about 2.7 million individual borrowers. We have been able to go out and provide credit to people; the vast majority of our customers come to us through USSD, which is a group that has been severely underserved in Africa.What is your vision for Mathesis over the next decade?We live in a world where ten years is forever. Ten years is if you think back ten years, it is like going into the Stone Age. If we look at the next ten years, our goal is to be the major decision engine that handles any conversation where payment and fulfilment differ across Africa. And let me explain what that means. If I go out and I pay for a car, the man says he will bring the car in two weeks. There is risk in that. Our goal is that before you make that decision, you take that guy’s information, you are going to run it through us, and we will give you the probability that he will run away with the car. Then you can make an intelligent decision if you should give him the money for that. And it is the same thing in insurance. Somebody comes today when you go to buy insurance; they just give you one number. Everybody comes and says five per cent. You fight them and say it is 2.5 per cent. However, the two of you should never get to the same rate because if I dig into your life, I should be able to find out who you are and score that and do the same for you and score that. So, if I am the insurance company, I will say you are a proper man. You do not have issues. You do not owe anybody. And because you do not owe anybody, I think you will be a good risk. And I say to the other person and say your look is disturbing; you are a high risk. The goal is that we are there every time anybody wants to make a decision. Insurance, individual, real estate, banks, etc. We help you decide if you should take on that risk.How does Mathesis differ from traditional credit bureaus?So, credit bureaus are like the post office. So, every institution has a box. And inside that box, there are individuals in it. So, anytime the person does a transaction, you take it and put it in that box. And Nigeria’s credit bureau has become negative only. Which is, no matter what you do when you are paying, they do not bother; they do not bother going to put your name in the credit bureau. The day you do not pay, they are going to put your name in the credit bureau as a bad lender. So, what they do is mechanical. They are just collating data. Some of them are just selling scores, but the predictive value is pretty low. What we do is the predictive value side. We do not run around. That is not what we do. What we do is we work with institutions to take all the data that they currently have and give them an output that has real predictive value on how each particular borrower they take out of this pool works. How each particular person is most likely to behave. And again, there is no magic to it. Do some people who have high scores default? It happens. But if you look at it over time, over the population. We get it right more often than we get it wrong.The Minister of Finance recently argued that Nigeria’s rising public debt is largely a consequence of currency devaluation rather than new borrowing by the current administration. What is your assessment of that position?Does devaluation of currency make sense? Yes, it does. It does make sense because if you take the current exchange rate and apply it, if you go back five years and you take that exchange rate and apply it, you get a different number. So, is that part of it? I am sure it is. Now, is that all it is? Probably not. The good thing is the vast majority of our borrowing has been internal. So, it has been naira-based. You do not have to worry too much. Not that you do not have to worry about it, but at least it is serviceable. So, let us look at it this way. If they were going to borrow to buy this laptop three years ago, it would be X. If they try to buy this laptop today and they borrow money to do it, it would be five times that amount. So, as I said, what he said is true, but as with the finances of anybody’s house, the finances of the country are nuanced. So, making a proclamation, this is why it happened. No. It is probably not true. You have to look at the entire process. Well, if you say that is why it happened, and the question is, why did you not increase taxes here? So, there are so many levels. So, I personally tend not to listen to those things. Nine times out of ten, if I want to understand nuanced positions, I look for people that are speaking not from a political podium, but more from an academic podium because academics tend to just talk. They have nothing to lose. They have no agenda.Do you believe the naira has reached its fair market value?Given the level of growth that we are seeing in the country, I think long term if the growth levels do not get better, the naira is going to continue to depreciate. But given that now it is free floating, I think the pace of the depreciation would be quite low. And we will see spikes up as we go along the way. So, if you look at recent history when we had a managed process, the problem with the managed process is like you take a balloon, fill it with air, and you start squeezing it on one side. After you squeeze it, it will get to a point where it will just explode. That is those crazy devaluations we used to see. We are not going to see them going forward. I think until the level of growth increases, we are going to see general depreciation going forward.What is your outlook for the economy in the second half of the year?I think it will be no different from the first part. The only thing that concerns me is that everything that is going on in the Middle East is not getting better; it is getting worse. And if it continues to get worse, the price of energy will go up. And if the price of energy goes up, that is just going to flow into everything. So, inflation might get a little higher. So, but aside from that, I do not see anything. Everybody is looking forward to election spending, but the election spending is just going to help increase inflation. So, if there is one thing I expect for the next half year is probably a little bit of a tick-up in inflation. That is about it. Nigeria has several national databases, including the BVN, NIN and driver’s licence records. How can these data assets be leveraged to create economic value and unlock new financial opportunities?When I am trying to see how I can make this simple, because I am about to talk about it in mathematics. All this data, at the end of the day, some of them are just the same thing.BVN is your identity information based on banks. NIN is your general identification. The two of them are interchangeable. The driver’s licence is your identification based on the fact that you drive. The driver’s licence tells me something. It tells me that you know how to drive, and you might own a car. How do you turn all this into money? What you do is you take the data pools; with the BVN, I can see not just the individual, but I can see the economic value. In the NIN, what I would see there would be data that I can use to confirm BVNs. If I pull in your driver’s licence, in Nigeria the only thing it means is that you might own a car. Outside of Nigeria, if I pull in your driver’s licence, I also pull in your driving record, and what your driving record tells me is: are you someone that always speeds, or are you someone that has bad driving behaviour? Because if you have bad driving behaviour, you are probably going to be a bad borrower, because your driving record is your behaviour. And if we go back and look at what the things we talk about when we talk about lending are, it is the three things of lending: credit, character and collateral. If you are a bad driver, that means you are generally someone of questionable character. You take all these things, and you quantify them; you put them through an algorithm, and it will give you a score. And that score is a prediction of two things. It will predict, in some cases, how much you should lend that person, and it predicts the probability that that person will not pay you back. And that is how this whole thing becomes money. So, when you take those two scores and take them to a bank, a bank now looks at it and says, “Am I willing to take this risk?” Yes or no? If the bank says yes, all of a sudden you have created an economic event whereby the bank loans money to that person. Pays us a fee for what we do, and then the bank earns interest on that.The government has been pushing for a transition to a credit-driven economy, yet progress appears to have been slow. What do you think is holding back this transition?I think we have made some progress, but the goal that we have as a country will be achieved once the fintechs and the banks realise that they are all on the same side. Once they all realise that they are collaborators rather than competitors. Once they realise that, it opens up everything because at that point in time the banks do not have to go and look for somebody that is looking for a N5,000 loan because just doing the paperwork and the pen used in processing the loan is more than the N5,000 loan. So, what would they do? They will outsource that process to a fintech company. A fintech can do it at pennies on the naira.Related NewsDangote refinery not enough for African market – FGTinubu, Shettima, Oyedele for CIBN banking conferenceNigeria targets $100bn investment commitments at summitHow does your company strike a balance between driving innovation and complying with regulations in Nigeria’s rapidly evolving fintech industry?Regulation makes operations easier. Because if you think about a totally unregulated space, that means anybody can do anything. And then if anybody can do anything, every single time the end user has a dispute. That dispute will end up in court, and it will be left to the courts to actually go ahead and decide who, what, and where. And that entire process is expensive and time-consuming. So, if you are a fintech, dealing with thousands of customers, and one per cent of them should sue you. What happens? So, when you have thoughtful regulation, it basically tells everybody what the guard rails are. It gives you the rules of the guard rails. And once you follow those guard rails, it is clear that only things that are outside those guard rails will cost you any peril. So, regulation does not stop innovation. It just lets you understand how you play.Although the economy has achieved some stability, challenges such as inflation and exchange rate volatility persist. What role can fintech companies play in helping businesses and consumers navigate these pressures?Fintechs have no power in this. They have no power to do anything about this. What they can do on their side is structure their business in such a way that depreciation of the naira and high interest rates do not affect them. On the other side, when you talk about their customers, what can they do to help their customers? Very little. Remember, fintechs are price takers when it comes to the funds that they facilitate the lending of, and when it comes to any deposits that they are able to attract. So, there is really not much that they can do.So, how can they help small businesses?It is just being able to continue to lend through that process. So, what you will find is banks get to a point where they say, because of the economic situation, we are going to wind down our books. And when they say they are going to wind down their books, all it means is that they are going to go out and call loans. What fintechs can do is, because they are iterative, they can continue to iterate price risk intelligently so that those banks that have partnered with them can continue to lend with confidence.Looking back over the past seven years, what would you consider Mathesis’s biggest achievements and milestones?In the last seven years, we have facilitated about 8.5 million loans, about $260m. We have facilitated lending to about 2.7 million individual borrowers. We have been able to go out and provide credit to people; the vast majority of our customers come to us through USSD, which is a group that has been severely underserved in Africa.What is your vision for Mathesis over the next decade?We live in a world where ten years is forever. Ten years is if you think back ten years, it is like going into the Stone Age. If we look at the next ten years, our goal is to be the major decision engine that handles any conversation where payment and fulfilment differ across Africa. And let me explain what that means. If I go out and I pay for a car, the man says he will bring the car in two weeks. There is risk in that. Our goal is that before you make that decision, you take that guy’s information, you are going to run it through us, and we will give you the probability that he will run away with the car. Then you can make an intelligent decision if you should give him the money for that. And it is the same thing in insurance. Somebody comes today when you go to buy insurance; they just give you one number. Everybody comes and says five per cent. You fight them and say it is 2.5 per cent. However, the two of you should never get to the same rate because if I dig into your life, I should be able to find out who you are and score that and do the same for you and score that. So, if I am the insurance company, I will say you are a proper man. You do not have issues. You do not owe anybody. And because you do not owe anybody, I think you will be a good risk. And I say to the other person and say your look is disturbing; you are a high risk. The goal is that we are there every time anybody wants to make a decision. Insurance, individual, real estate, banks, etc. We help you decide if you should take on that risk.How does Mathesis differ from traditional credit bureaus?So, credit bureaus are like the post office. So, every institution has a box. And inside that box, there are individuals in it. So, anytime the person does a transaction, you take it and put it in that box. And Nigeria’s credit bureau has become negative only. Which is, no matter what you do when you are paying, they do not bother; they do not bother going to put your name in the credit bureau. The day you do not pay, they are going to put your name in the credit bureau as a bad lender. So, what they do is mechanical. They are just collating data. Some of them are just selling scores, but the predictive value is pretty low. What we do is the predictive value side. We do not run around. That is not what we do. What we do is we work with institutions to take all the data that they currently have and give them an output that has real predictive value on how each particular borrower they take out of this pool works. How each particular person is most likely to behave. And again, there is no magic to it. Do some people who have high scores default? It happens. But if you look at it over time, over the population. We get it right more often than we get it wrong.The Minister of Finance recently argued that Nigeria’s rising public debt is largely a consequence of currency devaluation rather than new borrowing by the current administration. What is your assessment of that position?Does devaluation of currency make sense? Yes, it does. It does make sense because if you take the current exchange rate and apply it, if you go back five years and you take that exchange rate and apply it, you get a different number. So, is that part of it? I am sure it is. Now, is that all it is? Probably not. The good thing is the vast majority of our borrowing has been internal. So, it has been naira-based. You do not have to worry too much. Not that you do not have to worry about it, but at least it is serviceable. So, let us look at it this way. If they were going to borrow to buy this laptop three years ago, it would be X. If they try to buy this laptop today and they borrow money to do it, it would be five times that amount. So, as I said, what he said is true, but as with the finances of anybody’s house, the finances of the country are nuanced. So, making a proclamation, this is why it happened. No. It is probably not true. You have to look at the entire process. Well, if you say that is why it happened, and the question is, why did you not increase taxes here? So, there are so many levels. So, I personally tend not to listen to those things. Nine times out of ten, if I want to understand nuanced positions, I look for people that are speaking not from a political podium, but more from an academic podium because academics tend to just talk. They have nothing to lose. They have no agenda.Do you believe the naira has reached its fair market value?Given the level of growth that we are seeing in the country, I think long term if the growth levels do not get better, the naira is going to continue to depreciate. But given that now it is free floating, I think the pace of the depreciation would be quite low. And we will see spikes up as we go along the way. So, if you look at recent history when we had a managed process, the problem with the managed process is like you take a balloon, fill it with air, and you start squeezing it on one side. After you squeeze it, it will get to a point where it will just explode. That is those crazy devaluations we used to see. We are not going to see them going forward. I think until the level of growth increases, we are going to see general depreciation going forward.What is your outlook for the economy in the second half of the year?I think it will be no different from the first part. The only thing that concerns me is that everything that is going on in the Middle East is not getting better; it is getting worse. And if it continues to get worse, the price of energy will go up. And if the price of energy goes up, that is just going to flow into everything. So, inflation might get a little higher. So, but aside from that, I do not see anything. Everybody is looking forward to election spending, but the election spending is just going to help increase inflation. So, if there is one thing I expect for the next half year is probably a little bit of a tick-up in inflation. That is about it. When I am trying to see how I can make this simple, because I am about to talk about it in mathematics. All this data, at the end of the day, some of them are just the same thing.BVN is your identity information based on banks. NIN is your general identification. The two of them are interchangeable. The driver’s licence is your identification based on the fact that you drive. The driver’s licence tells me something. It tells me that you know how to drive, and you might own a car. How do you turn all this into money? What you do is you take the data pools; with the BVN, I can see not just the individual, but I can see the economic value. In the NIN, what I would see there would be data that I can use to confirm BVNs. If I pull in your driver’s licence, in Nigeria the only thing it means is that you might own a car. Outside of Nigeria, if I pull in your driver’s licence, I also pull in your driving record, and what your driving record tells me is: are you someone that always speeds, or are you someone that has bad driving behaviour? Because if you have bad driving behaviour, you are probably going to be a bad borrower, because your driving record is your behaviour. And if we go back and look at what the things we talk about when we talk about lending are, it is the three things of lending: credit, character and collateral. If you are a bad driver, that means you are generally someone of questionable character. You take all these things, and you quantify them; you put them through an algorithm, and it will give you a score. And that score is a prediction of two things. It will predict, in some cases, how much you should lend that person, and it predicts the probability that that person will not pay you back. And that is how this whole thing becomes money. So, when you take those two scores and take them to a bank, a bank now looks at it and says, “Am I willing to take this risk?” Yes or no? If the bank says yes, all of a sudden you have created an economic event whereby the bank loans money to that person. Pays us a fee for what we do, and then the bank earns interest on that.The government has been pushing for a transition to a credit-driven economy, yet progress appears to have been slow. What do you think is holding back this transition?I think we have made some progress, but the goal that we have as a country will be achieved once the fintechs and the banks realise that they are all on the same side. Once they all realise that they are collaborators rather than competitors. Once they realise that, it opens up everything because at that point in time the banks do not have to go and look for somebody that is looking for a N5,000 loan because just doing the paperwork and the pen used in processing the loan is more than the N5,000 loan. So, what would they do? They will outsource that process to a fintech company. A fintech can do it at pennies on the naira.Related NewsDangote refinery not enough for African market – FGTinubu, Shettima, Oyedele for CIBN banking conferenceNigeria targets $100bn investment commitments at summitHow does your company strike a balance between driving innovation and complying with regulations in Nigeria’s rapidly evolving fintech industry?Regulation makes operations easier. Because if you think about a totally unregulated space, that means anybody can do anything. And then if anybody can do anything, every single time the end user has a dispute. That dispute will end up in court, and it will be left to the courts to actually go ahead and decide who, what, and where. And that entire process is expensive and time-consuming. So, if you are a fintech, dealing with thousands of customers, and one per cent of them should sue you. What happens? So, when you have thoughtful regulation, it basically tells everybody what the guard rails are. It gives you the rules of the guard rails. And once you follow those guard rails, it is clear that only things that are outside those guard rails will cost you any peril. So, regulation does not stop innovation. It just lets you understand how you play.Although the economy has achieved some stability, challenges such as inflation and exchange rate volatility persist. What role can fintech companies play in helping businesses and consumers navigate these pressures?Fintechs have no power in this. They have no power to do anything about this. What they can do on their side is structure their business in such a way that depreciation of the naira and high interest rates do not affect them. On the other side, when you talk about their customers, what can they do to help their customers? Very little. Remember, fintechs are price takers when it comes to the funds that they facilitate the lending of, and when it comes to any deposits that they are able to attract. So, there is really not much that they can do.So, how can they help small businesses?It is just being able to continue to lend through that process. So, what you will find is banks get to a point where they say, because of the economic situation, we are going to wind down our books. And when they say they are going to wind down their books, all it means is that they are going to go out and call loans. What fintechs can do is, because they are iterative, they can continue to iterate price risk intelligently so that those banks that have partnered with them can continue to lend with confidence.Looking back over the past seven years, what would you consider Mathesis’s biggest achievements and milestones?In the last seven years, we have facilitated about 8.5 million loans, about $260m. We have facilitated lending to about 2.7 million individual borrowers. We have been able to go out and provide credit to people; the vast majority of our customers come to us through USSD, which is a group that has been severely underserved in Africa.What is your vision for Mathesis over the next decade?We live in a world where ten years is forever. Ten years is if you think back ten years, it is like going into the Stone Age. If we look at the next ten years, our goal is to be the major decision engine that handles any conversation where payment and fulfilment differ across Africa. And let me explain what that means. If I go out and I pay for a car, the man says he will bring the car in two weeks. There is risk in that. Our goal is that before you make that decision, you take that guy’s information, you are going to run it through us, and we will give you the probability that he will run away with the car. Then you can make an intelligent decision if you should give him the money for that. And it is the same thing in insurance. Somebody comes today when you go to buy insurance; they just give you one number. Everybody comes and says five per cent. You fight them and say it is 2.5 per cent. However, the two of you should never get to the same rate because if I dig into your life, I should be able to find out who you are and score that and do the same for you and score that. So, if I am the insurance company, I will say you are a proper man. You do not have issues. You do not owe anybody. And because you do not owe anybody, I think you will be a good risk. And I say to the other person and say your look is disturbing; you are a high risk. The goal is that we are there every time anybody wants to make a decision. Insurance, individual, real estate, banks, etc. We help you decide if you should take on that risk.How does Mathesis differ from traditional credit bureaus?So, credit bureaus are like the post office. So, every institution has a box. And inside that box, there are individuals in it. So, anytime the person does a transaction, you take it and put it in that box. And Nigeria’s credit bureau has become negative only. Which is, no matter what you do when you are paying, they do not bother; they do not bother going to put your name in the credit bureau. The day you do not pay, they are going to put your name in the credit bureau as a bad lender. So, what they do is mechanical. They are just collating data. Some of them are just selling scores, but the predictive value is pretty low. What we do is the predictive value side. We do not run around. That is not what we do. What we do is we work with institutions to take all the data that they currently have and give them an output that has real predictive value on how each particular borrower they take out of this pool works. How each particular person is most likely to behave. And again, there is no magic to it. Do some people who have high scores default? It happens. But if you look at it over time, over the population. We get it right more often than we get it wrong.The Minister of Finance recently argued that Nigeria’s rising public debt is largely a consequence of currency devaluation rather than new borrowing by the current administration. What is your assessment of that position?Does devaluation of currency make sense? Yes, it does. It does make sense because if you take the current exchange rate and apply it, if you go back five years and you take that exchange rate and apply it, you get a different number. So, is that part of it? I am sure it is. Now, is that all it is? Probably not. The good thing is the vast majority of our borrowing has been internal. So, it has been naira-based. You do not have to worry too much. Not that you do not have to worry about it, but at least it is serviceable. So, let us look at it this way. If they were going to borrow to buy this laptop three years ago, it would be X. If they try to buy this laptop today and they borrow money to do it, it would be five times that amount. So, as I said, what he said is true, but as with the finances of anybody’s house, the finances of the country are nuanced. So, making a proclamation, this is why it happened. No. It is probably not true. You have to look at the entire process. Well, if you say that is why it happened, and the question is, why did you not increase taxes here? So, there are so many levels. So, I personally tend not to listen to those things. Nine times out of ten, if I want to understand nuanced positions, I look for people that are speaking not from a political podium, but more from an academic podium because academics tend to just talk. They have nothing to lose. They have no agenda.Do you believe the naira has reached its fair market value?Given the level of growth that we are seeing in the country, I think long term if the growth levels do not get better, the naira is going to continue to depreciate. But given that now it is free floating, I think the pace of the depreciation would be quite low. And we will see spikes up as we go along the way. So, if you look at recent history when we had a managed process, the problem with the managed process is like you take a balloon, fill it with air, and you start squeezing it on one side. After you squeeze it, it will get to a point where it will just explode. That is those crazy devaluations we used to see. We are not going to see them going forward. I think until the level of growth increases, we are going to see general depreciation going forward.What is your outlook for the economy in the second half of the year?I think it will be no different from the first part. The only thing that concerns me is that everything that is going on in the Middle East is not getting better; it is getting worse. And if it continues to get worse, the price of energy will go up. And if the price of energy goes up, that is just going to flow into everything. So, inflation might get a little higher. So, but aside from that, I do not see anything. Everybody is looking forward to election spending, but the election spending is just going to help increase inflation. So, if there is one thing I expect for the next half year is probably a little bit of a tick-up in inflation. That is about it. BVN is your identity information based on banks. NIN is your general identification. The two of them are interchangeable. The driver’s licence is your identification based on the fact that you drive. The driver’s licence tells me something. It tells me that you know how to drive, and you might own a car. How do you turn all this into money? What you do is you take the data pools; with the BVN, I can see not just the individual, but I can see the economic value. In the NIN, what I would see there would be data that I can use to confirm BVNs. If I pull in your driver’s licence, in Nigeria the only thing it means is that you might own a car. Outside of Nigeria, if I pull in your driver’s licence, I also pull in your driving record, and what your driving record tells me is: are you someone that always speeds, or are you someone that has bad driving behaviour? Because if you have bad driving behaviour, you are probably going to be a bad borrower, because your driving record is your behaviour. And if we go back and look at what the things we talk about when we talk about lending are, it is the three things of lending: credit, character and collateral. If you are a bad driver, that means you are generally someone of questionable character. You take all these things, and you quantify them; you put them through an algorithm, and it will give you a score. And that score is a prediction of two things. It will predict, in some cases, how much you should lend that person, and it predicts the probability that that person will not pay you back. And that is how this whole thing becomes money. So, when you take those two scores and take them to a bank, a bank now looks at it and says, “Am I willing to take this risk?” Yes or no? If the bank says yes, all of a sudden you have created an economic event whereby the bank loans money to that person. Pays us a fee for what we do, and then the bank earns interest on that.The government has been pushing for a transition to a credit-driven economy, yet progress appears to have been slow. What do you think is holding back this transition?I think we have made some progress, but the goal that we have as a country will be achieved once the fintechs and the banks realise that they are all on the same side. Once they all realise that they are collaborators rather than competitors. Once they realise that, it opens up everything because at that point in time the banks do not have to go and look for somebody that is looking for a N5,000 loan because just doing the paperwork and the pen used in processing the loan is more than the N5,000 loan. So, what would they do? They will outsource that process to a fintech company. A fintech can do it at pennies on the naira.Related NewsDangote refinery not enough for African market – FGTinubu, Shettima, Oyedele for CIBN banking conferenceNigeria targets $100bn investment commitments at summitHow does your company strike a balance between driving innovation and complying with regulations in Nigeria’s rapidly evolving fintech industry?Regulation makes operations easier. Because if you think about a totally unregulated space, that means anybody can do anything. And then if anybody can do anything, every single time the end user has a dispute. That dispute will end up in court, and it will be left to the courts to actually go ahead and decide who, what, and where. And that entire process is expensive and time-consuming. So, if you are a fintech, dealing with thousands of customers, and one per cent of them should sue you. What happens? So, when you have thoughtful regulation, it basically tells everybody what the guard rails are. It gives you the rules of the guard rails. And once you follow those guard rails, it is clear that only things that are outside those guard rails will cost you any peril. So, regulation does not stop innovation. It just lets you understand how you play.Although the economy has achieved some stability, challenges such as inflation and exchange rate volatility persist. What role can fintech companies play in helping businesses and consumers navigate these pressures?Fintechs have no power in this. They have no power to do anything about this. What they can do on their side is structure their business in such a way that depreciation of the naira and high interest rates do not affect them. On the other side, when you talk about their customers, what can they do to help their customers? Very little. Remember, fintechs are price takers when it comes to the funds that they facilitate the lending of, and when it comes to any deposits that they are able to attract. So, there is really not much that they can do.So, how can they help small businesses?It is just being able to continue to lend through that process. So, what you will find is banks get to a point where they say, because of the economic situation, we are going to wind down our books. And when they say they are going to wind down their books, all it means is that they are going to go out and call loans. What fintechs can do is, because they are iterative, they can continue to iterate price risk intelligently so that those banks that have partnered with them can continue to lend with confidence.Looking back over the past seven years, what would you consider Mathesis’s biggest achievements and milestones?In the last seven years, we have facilitated about 8.5 million loans, about $260m. We have facilitated lending to about 2.7 million individual borrowers. We have been able to go out and provide credit to people; the vast majority of our customers come to us through USSD, which is a group that has been severely underserved in Africa.What is your vision for Mathesis over the next decade?We live in a world where ten years is forever. Ten years is if you think back ten years, it is like going into the Stone Age. If we look at the next ten years, our goal is to be the major decision engine that handles any conversation where payment and fulfilment differ across Africa. And let me explain what that means. If I go out and I pay for a car, the man says he will bring the car in two weeks. There is risk in that. Our goal is that before you make that decision, you take that guy’s information, you are going to run it through us, and we will give you the probability that he will run away with the car. Then you can make an intelligent decision if you should give him the money for that. And it is the same thing in insurance. Somebody comes today when you go to buy insurance; they just give you one number. Everybody comes and says five per cent. You fight them and say it is 2.5 per cent. However, the two of you should never get to the same rate because if I dig into your life, I should be able to find out who you are and score that and do the same for you and score that. So, if I am the insurance company, I will say you are a proper man. You do not have issues. You do not owe anybody. And because you do not owe anybody, I think you will be a good risk. And I say to the other person and say your look is disturbing; you are a high risk. The goal is that we are there every time anybody wants to make a decision. Insurance, individual, real estate, banks, etc. We help you decide if you should take on that risk.How does Mathesis differ from traditional credit bureaus?So, credit bureaus are like the post office. So, every institution has a box. And inside that box, there are individuals in it. So, anytime the person does a transaction, you take it and put it in that box. And Nigeria’s credit bureau has become negative only. Which is, no matter what you do when you are paying, they do not bother; they do not bother going to put your name in the credit bureau. The day you do not pay, they are going to put your name in the credit bureau as a bad lender. So, what they do is mechanical. They are just collating data. Some of them are just selling scores, but the predictive value is pretty low. What we do is the predictive value side. We do not run around. That is not what we do. What we do is we work with institutions to take all the data that they currently have and give them an output that has real predictive value on how each particular borrower they take out of this pool works. How each particular person is most likely to behave. And again, there is no magic to it. Do some people who have high scores default? It happens. But if you look at it over time, over the population. We get it right more often than we get it wrong.The Minister of Finance recently argued that Nigeria’s rising public debt is largely a consequence of currency devaluation rather than new borrowing by the current administration. What is your assessment of that position?Does devaluation of currency make sense? Yes, it does. It does make sense because if you take the current exchange rate and apply it, if you go back five years and you take that exchange rate and apply it, you get a different number. So, is that part of it? I am sure it is. Now, is that all it is? Probably not. The good thing is the vast majority of our borrowing has been internal. So, it has been naira-based. You do not have to worry too much. Not that you do not have to worry about it, but at least it is serviceable. So, let us look at it this way. If they were going to borrow to buy this laptop three years ago, it would be X. If they try to buy this laptop today and they borrow money to do it, it would be five times that amount. So, as I said, what he said is true, but as with the finances of anybody’s house, the finances of the country are nuanced. So, making a proclamation, this is why it happened. No. It is probably not true. You have to look at the entire process. Well, if you say that is why it happened, and the question is, why did you not increase taxes here? So, there are so many levels. So, I personally tend not to listen to those things. Nine times out of ten, if I want to understand nuanced positions, I look for people that are speaking not from a political podium, but more from an academic podium because academics tend to just talk. They have nothing to lose. They have no agenda.Do you believe the naira has reached its fair market value?Given the level of growth that we are seeing in the country, I think long term if the growth levels do not get better, the naira is going to continue to depreciate. But given that now it is free floating, I think the pace of the depreciation would be quite low. And we will see spikes up as we go along the way. So, if you look at recent history when we had a managed process, the problem with the managed process is like you take a balloon, fill it with air, and you start squeezing it on one side. After you squeeze it, it will get to a point where it will just explode. That is those crazy devaluations we used to see. We are not going to see them going forward. I think until the level of growth increases, we are going to see general depreciation going forward.What is your outlook for the economy in the second half of the year?I think it will be no different from the first part. The only thing that concerns me is that everything that is going on in the Middle East is not getting better; it is getting worse. And if it continues to get worse, the price of energy will go up. And if the price of energy goes up, that is just going to flow into everything. So, inflation might get a little higher. So, but aside from that, I do not see anything. Everybody is looking forward to election spending, but the election spending is just going to help increase inflation. So, if there is one thing I expect for the next half year is probably a little bit of a tick-up in inflation. That is about it. The government has been pushing for a transition to a credit-driven economy, yet progress appears to have been slow. What do you think is holding back this transition?I think we have made some progress, but the goal that we have as a country will be achieved once the fintechs and the banks realise that they are all on the same side. Once they all realise that they are collaborators rather than competitors. Once they realise that, it opens up everything because at that point in time the banks do not have to go and look for somebody that is looking for a N5,000 loan because just doing the paperwork and the pen used in processing the loan is more than the N5,000 loan. So, what would they do? They will outsource that process to a fintech company. A fintech can do it at pennies on the naira.Related NewsDangote refinery not enough for African market – FGTinubu, Shettima, Oyedele for CIBN banking conferenceNigeria targets $100bn investment commitments at summitHow does your company strike a balance between driving innovation and complying with regulations in Nigeria’s rapidly evolving fintech industry?Regulation makes operations easier. Because if you think about a totally unregulated space, that means anybody can do anything. And then if anybody can do anything, every single time the end user has a dispute. That dispute will end up in court, and it will be left to the courts to actually go ahead and decide who, what, and where. And that entire process is expensive and time-consuming. So, if you are a fintech, dealing with thousands of customers, and one per cent of them should sue you. What happens? So, when you have thoughtful regulation, it basically tells everybody what the guard rails are. It gives you the rules of the guard rails. And once you follow those guard rails, it is clear that only things that are outside those guard rails will cost you any peril. So, regulation does not stop innovation. It just lets you understand how you play.Although the economy has achieved some stability, challenges such as inflation and exchange rate volatility persist. What role can fintech companies play in helping businesses and consumers navigate these pressures?Fintechs have no power in this. They have no power to do anything about this. What they can do on their side is structure their business in such a way that depreciation of the naira and high interest rates do not affect them. On the other side, when you talk about their customers, what can they do to help their customers? Very little. Remember, fintechs are price takers when it comes to the funds that they facilitate the lending of, and when it comes to any deposits that they are able to attract. So, there is really not much that they can do.So, how can they help small businesses?It is just being able to continue to lend through that process. So, what you will find is banks get to a point where they say, because of the economic situation, we are going to wind down our books. And when they say they are going to wind down their books, all it means is that they are going to go out and call loans. What fintechs can do is, because they are iterative, they can continue to iterate price risk intelligently so that those banks that have partnered with them can continue to lend with confidence.Looking back over the past seven years, what would you consider Mathesis’s biggest achievements and milestones?In the last seven years, we have facilitated about 8.5 million loans, about $260m. We have facilitated lending to about 2.7 million individual borrowers. We have been able to go out and provide credit to people; the vast majority of our customers come to us through USSD, which is a group that has been severely underserved in Africa.What is your vision for Mathesis over the next decade?We live in a world where ten years is forever. Ten years is if you think back ten years, it is like going into the Stone Age. If we look at the next ten years, our goal is to be the major decision engine that handles any conversation where payment and fulfilment differ across Africa. And let me explain what that means. If I go out and I pay for a car, the man says he will bring the car in two weeks. There is risk in that. Our goal is that before you make that decision, you take that guy’s information, you are going to run it through us, and we will give you the probability that he will run away with the car. Then you can make an intelligent decision if you should give him the money for that. And it is the same thing in insurance. Somebody comes today when you go to buy insurance; they just give you one number. Everybody comes and says five per cent. You fight them and say it is 2.5 per cent. However, the two of you should never get to the same rate because if I dig into your life, I should be able to find out who you are and score that and do the same for you and score that. So, if I am the insurance company, I will say you are a proper man. You do not have issues. You do not owe anybody. And because you do not owe anybody, I think you will be a good risk. And I say to the other person and say your look is disturbing; you are a high risk. The goal is that we are there every time anybody wants to make a decision. Insurance, individual, real estate, banks, etc. We help you decide if you should take on that risk.How does Mathesis differ from traditional credit bureaus?So, credit bureaus are like the post office. So, every institution has a box. And inside that box, there are individuals in it. So, anytime the person does a transaction, you take it and put it in that box. And Nigeria’s credit bureau has become negative only. Which is, no matter what you do when you are paying, they do not bother; they do not bother going to put your name in the credit bureau. The day you do not pay, they are going to put your name in the credit bureau as a bad lender. So, what they do is mechanical. They are just collating data. Some of them are just selling scores, but the predictive value is pretty low. What we do is the predictive value side. We do not run around. That is not what we do. What we do is we work with institutions to take all the data that they currently have and give them an output that has real predictive value on how each particular borrower they take out of this pool works. How each particular person is most likely to behave. And again, there is no magic to it. Do some people who have high scores default? It happens. But if you look at it over time, over the population. We get it right more often than we get it wrong.The Minister of Finance recently argued that Nigeria’s rising public debt is largely a consequence of currency devaluation rather than new borrowing by the current administration. What is your assessment of that position?Does devaluation of currency make sense? Yes, it does. It does make sense because if you take the current exchange rate and apply it, if you go back five years and you take that exchange rate and apply it, you get a different number. So, is that part of it? I am sure it is. Now, is that all it is? Probably not. The good thing is the vast majority of our borrowing has been internal. So, it has been naira-based. You do not have to worry too much. Not that you do not have to worry about it, but at least it is serviceable. So, let us look at it this way. If they were going to borrow to buy this laptop three years ago, it would be X. If they try to buy this laptop today and they borrow money to do it, it would be five times that amount. So, as I said, what he said is true, but as with the finances of anybody’s house, the finances of the country are nuanced. So, making a proclamation, this is why it happened. No. It is probably not true. You have to look at the entire process. Well, if you say that is why it happened, and the question is, why did you not increase taxes here? So, there are so many levels. So, I personally tend not to listen to those things. Nine times out of ten, if I want to understand nuanced positions, I look for people that are speaking not from a political podium, but more from an academic podium because academics tend to just talk. They have nothing to lose. They have no agenda.Do you believe the naira has reached its fair market value?Given the level of growth that we are seeing in the country, I think long term if the growth levels do not get better, the naira is going to continue to depreciate. But given that now it is free floating, I think the pace of the depreciation would be quite low. And we will see spikes up as we go along the way. So, if you look at recent history when we had a managed process, the problem with the managed process is like you take a balloon, fill it with air, and you start squeezing it on one side. After you squeeze it, it will get to a point where it will just explode. That is those crazy devaluations we used to see. We are not going to see them going forward. I think until the level of growth increases, we are going to see general depreciation going forward.What is your outlook for the economy in the second half of the year?I think it will be no different from the first part. The only thing that concerns me is that everything that is going on in the Middle East is not getting better; it is getting worse. And if it continues to get worse, the price of energy will go up. And if the price of energy goes up, that is just going to flow into everything. So, inflation might get a little higher. So, but aside from that, I do not see anything. Everybody is looking forward to election spending, but the election spending is just going to help increase inflation. So, if there is one thing I expect for the next half year is probably a little bit of a tick-up in inflation. That is about it. I think we have made some progress, but the goal that we have as a country will be achieved once the fintechs and the banks realise that they are all on the same side. Once they all realise that they are collaborators rather than competitors. Once they realise that, it opens up everything because at that point in time the banks do not have to go and look for somebody that is looking for a N5,000 loan because just doing the paperwork and the pen used in processing the loan is more than the N5,000 loan. So, what would they do? They will outsource that process to a fintech company. A fintech can do it at pennies on the naira.Related NewsDangote refinery not enough for African market – FGTinubu, Shettima, Oyedele for CIBN banking conferenceNigeria targets $100bn investment commitments at summitHow does your company strike a balance between driving innovation and complying with regulations in Nigeria’s rapidly evolving fintech industry?Regulation makes operations easier. Because if you think about a totally unregulated space, that means anybody can do anything. And then if anybody can do anything, every single time the end user has a dispute. That dispute will end up in court, and it will be left to the courts to actually go ahead and decide who, what, and where. And that entire process is expensive and time-consuming. So, if you are a fintech, dealing with thousands of customers, and one per cent of them should sue you. What happens? So, when you have thoughtful regulation, it basically tells everybody what the guard rails are. It gives you the rules of the guard rails. And once you follow those guard rails, it is clear that only things that are outside those guard rails will cost you any peril. So, regulation does not stop innovation. It just lets you understand how you play.Although the economy has achieved some stability, challenges such as inflation and exchange rate volatility persist. What role can fintech companies play in helping businesses and consumers navigate these pressures?Fintechs have no power in this. They have no power to do anything about this. What they can do on their side is structure their business in such a way that depreciation of the naira and high interest rates do not affect them. On the other side, when you talk about their customers, what can they do to help their customers? Very little. Remember, fintechs are price takers when it comes to the funds that they facilitate the lending of, and when it comes to any deposits that they are able to attract. So, there is really not much that they can do.So, how can they help small businesses?It is just being able to continue to lend through that process. So, what you will find is banks get to a point where they say, because of the economic situation, we are going to wind down our books. And when they say they are going to wind down their books, all it means is that they are going to go out and call loans. What fintechs can do is, because they are iterative, they can continue to iterate price risk intelligently so that those banks that have partnered with them can continue to lend with confidence.Looking back over the past seven years, what would you consider Mathesis’s biggest achievements and milestones?In the last seven years, we have facilitated about 8.5 million loans, about $260m. We have facilitated lending to about 2.7 million individual borrowers. We have been able to go out and provide credit to people; the vast majority of our customers come to us through USSD, which is a group that has been severely underserved in Africa.What is your vision for Mathesis over the next decade?We live in a world where ten years is forever. Ten years is if you think back ten years, it is like going into the Stone Age. If we look at the next ten years, our goal is to be the major decision engine that handles any conversation where payment and fulfilment differ across Africa. And let me explain what that means. If I go out and I pay for a car, the man says he will bring the car in two weeks. There is risk in that. Our goal is that before you make that decision, you take that guy’s information, you are going to run it through us, and we will give you the probability that he will run away with the car. Then you can make an intelligent decision if you should give him the money for that. And it is the same thing in insurance. Somebody comes today when you go to buy insurance; they just give you one number. Everybody comes and says five per cent. You fight them and say it is 2.5 per cent. However, the two of you should never get to the same rate because if I dig into your life, I should be able to find out who you are and score that and do the same for you and score that. So, if I am the insurance company, I will say you are a proper man. You do not have issues. You do not owe anybody. And because you do not owe anybody, I think you will be a good risk. And I say to the other person and say your look is disturbing; you are a high risk. The goal is that we are there every time anybody wants to make a decision. Insurance, individual, real estate, banks, etc. We help you decide if you should take on that risk.How does Mathesis differ from traditional credit bureaus?So, credit bureaus are like the post office. So, every institution has a box. And inside that box, there are individuals in it. So, anytime the person does a transaction, you take it and put it in that box. And Nigeria’s credit bureau has become negative only. Which is, no matter what you do when you are paying, they do not bother; they do not bother going to put your name in the credit bureau. The day you do not pay, they are going to put your name in the credit bureau as a bad lender. So, what they do is mechanical. They are just collating data. Some of them are just selling scores, but the predictive value is pretty low. What we do is the predictive value side. We do not run around. That is not what we do. What we do is we work with institutions to take all the data that they currently have and give them an output that has real predictive value on how each particular borrower they take out of this pool works. How each particular person is most likely to behave. And again, there is no magic to it. Do some people who have high scores default? It happens. But if you look at it over time, over the population. We get it right more often than we get it wrong.The Minister of Finance recently argued that Nigeria’s rising public debt is largely a consequence of currency devaluation rather than new borrowing by the current administration. What is your assessment of that position?Does devaluation of currency make sense? Yes, it does. It does make sense because if you take the current exchange rate and apply it, if you go back five years and you take that exchange rate and apply it, you get a different number. So, is that part of it? I am sure it is. Now, is that all it is? Probably not. The good thing is the vast majority of our borrowing has been internal. So, it has been naira-based. You do not have to worry too much. Not that you do not have to worry about it, but at least it is serviceable. So, let us look at it this way. If they were going to borrow to buy this laptop three years ago, it would be X. If they try to buy this laptop today and they borrow money to do it, it would be five times that amount. So, as I said, what he said is true, but as with the finances of anybody’s house, the finances of the country are nuanced. So, making a proclamation, this is why it happened. No. It is probably not true. You have to look at the entire process. Well, if you say that is why it happened, and the question is, why did you not increase taxes here? So, there are so many levels. So, I personally tend not to listen to those things. Nine times out of ten, if I want to understand nuanced positions, I look for people that are speaking not from a political podium, but more from an academic podium because academics tend to just talk. They have nothing to lose. They have no agenda.Do you believe the naira has reached its fair market value?Given the level of growth that we are seeing in the country, I think long term if the growth levels do not get better, the naira is going to continue to depreciate. But given that now it is free floating, I think the pace of the depreciation would be quite low. And we will see spikes up as we go along the way. So, if you look at recent history when we had a managed process, the problem with the managed process is like you take a balloon, fill it with air, and you start squeezing it on one side. After you squeeze it, it will get to a point where it will just explode. That is those crazy devaluations we used to see. We are not going to see them going forward. I think until the level of growth increases, we are going to see general depreciation going forward.What is your outlook for the economy in the second half of the year?I think it will be no different from the first part. The only thing that concerns me is that everything that is going on in the Middle East is not getting better; it is getting worse. And if it continues to get worse, the price of energy will go up. And if the price of energy goes up, that is just going to flow into everything. So, inflation might get a little higher. So, but aside from that, I do not see anything. Everybody is looking forward to election spending, but the election spending is just going to help increase inflation. So, if there is one thing I expect for the next half year is probably a little bit of a tick-up in inflation. That is about it. Related NewsDangote refinery not enough for African market – FGTinubu, Shettima, Oyedele for CIBN banking conferenceNigeria targets $100bn investment commitments at summitHow does your company strike a balance between driving innovation and complying with regulations in Nigeria’s rapidly evolving fintech industry?Regulation makes operations easier. Because if you think about a totally unregulated space, that means anybody can do anything. And then if anybody can do anything, every single time the end user has a dispute. That dispute will end up in court, and it will be left to the courts to actually go ahead and decide who, what, and where. And that entire process is expensive and time-consuming. So, if you are a fintech, dealing with thousands of customers, and one per cent of them should sue you. What happens? So, when you have thoughtful regulation, it basically tells everybody what the guard rails are. It gives you the rules of the guard rails. And once you follow those guard rails, it is clear that only things that are outside those guard rails will cost you any peril. So, regulation does not stop innovation. It just lets you understand how you play.Although the economy has achieved some stability, challenges such as inflation and exchange rate volatility persist. What role can fintech companies play in helping businesses and consumers navigate these pressures?Fintechs have no power in this. They have no power to do anything about this. What they can do on their side is structure their business in such a way that depreciation of the naira and high interest rates do not affect them. On the other side, when you talk about their customers, what can they do to help their customers? Very little. Remember, fintechs are price takers when it comes to the funds that they facilitate the lending of, and when it comes to any deposits that they are able to attract. So, there is really not much that they can do.So, how can they help small businesses?It is just being able to continue to lend through that process. So, what you will find is banks get to a point where they say, because of the economic situation, we are going to wind down our books. And when they say they are going to wind down their books, all it means is that they are going to go out and call loans. What fintechs can do is, because they are iterative, they can continue to iterate price risk intelligently so that those banks that have partnered with them can continue to lend with confidence.Looking back over the past seven years, what would you consider Mathesis’s biggest achievements and milestones?In the last seven years, we have facilitated about 8.5 million loans, about $260m. We have facilitated lending to about 2.7 million individual borrowers. We have been able to go out and provide credit to people; the vast majority of our customers come to us through USSD, which is a group that has been severely underserved in Africa.What is your vision for Mathesis over the next decade?We live in a world where ten years is forever. Ten years is if you think back ten years, it is like going into the Stone Age. If we look at the next ten years, our goal is to be the major decision engine that handles any conversation where payment and fulfilment differ across Africa. And let me explain what that means. If I go out and I pay for a car, the man says he will bring the car in two weeks. There is risk in that. Our goal is that before you make that decision, you take that guy’s information, you are going to run it through us, and we will give you the probability that he will run away with the car. Then you can make an intelligent decision if you should give him the money for that. And it is the same thing in insurance. Somebody comes today when you go to buy insurance; they just give you one number. Everybody comes and says five per cent. You fight them and say it is 2.5 per cent. However, the two of you should never get to the same rate because if I dig into your life, I should be able to find out who you are and score that and do the same for you and score that. So, if I am the insurance company, I will say you are a proper man. You do not have issues. You do not owe anybody. And because you do not owe anybody, I think you will be a good risk. And I say to the other person and say your look is disturbing; you are a high risk. The goal is that we are there every time anybody wants to make a decision. Insurance, individual, real estate, banks, etc. We help you decide if you should take on that risk.How does Mathesis differ from traditional credit bureaus?So, credit bureaus are like the post office. So, every institution has a box. And inside that box, there are individuals in it. So, anytime the person does a transaction, you take it and put it in that box. And Nigeria’s credit bureau has become negative only. Which is, no matter what you do when you are paying, they do not bother; they do not bother going to put your name in the credit bureau. The day you do not pay, they are going to put your name in the credit bureau as a bad lender. So, what they do is mechanical. They are just collating data. Some of them are just selling scores, but the predictive value is pretty low. What we do is the predictive value side. We do not run around. That is not what we do. What we do is we work with institutions to take all the data that they currently have and give them an output that has real predictive value on how each particular borrower they take out of this pool works. How each particular person is most likely to behave. And again, there is no magic to it. Do some people who have high scores default? It happens. But if you look at it over time, over the population. We get it right more often than we get it wrong.The Minister of Finance recently argued that Nigeria’s rising public debt is largely a consequence of currency devaluation rather than new borrowing by the current administration. What is your assessment of that position?Does devaluation of currency make sense? Yes, it does. It does make sense because if you take the current exchange rate and apply it, if you go back five years and you take that exchange rate and apply it, you get a different number. So, is that part of it? I am sure it is. Now, is that all it is? Probably not. The good thing is the vast majority of our borrowing has been internal. So, it has been naira-based. You do not have to worry too much. Not that you do not have to worry about it, but at least it is serviceable. So, let us look at it this way. If they were going to borrow to buy this laptop three years ago, it would be X. If they try to buy this laptop today and they borrow money to do it, it would be five times that amount. So, as I said, what he said is true, but as with the finances of anybody’s house, the finances of the country are nuanced. So, making a proclamation, this is why it happened. No. It is probably not true. You have to look at the entire process. Well, if you say that is why it happened, and the question is, why did you not increase taxes here? So, there are so many levels. So, I personally tend not to listen to those things. Nine times out of ten, if I want to understand nuanced positions, I look for people that are speaking not from a political podium, but more from an academic podium because academics tend to just talk. They have nothing to lose. They have no agenda.Do you believe the naira has reached its fair market value?Given the level of growth that we are seeing in the country, I think long term if the growth levels do not get better, the naira is going to continue to depreciate. But given that now it is free floating, I think the pace of the depreciation would be quite low. And we will see spikes up as we go along the way. So, if you look at recent history when we had a managed process, the problem with the managed process is like you take a balloon, fill it with air, and you start squeezing it on one side. After you squeeze it, it will get to a point where it will just explode. That is those crazy devaluations we used to see. We are not going to see them going forward. I think until the level of growth increases, we are going to see general depreciation going forward.What is your outlook for the economy in the second half of the year?I think it will be no different from the first part. The only thing that concerns me is that everything that is going on in the Middle East is not getting better; it is getting worse. And if it continues to get worse, the price of energy will go up. And if the price of energy goes up, that is just going to flow into everything. So, inflation might get a little higher. So, but aside from that, I do not see anything. Everybody is looking forward to election spending, but the election spending is just going to help increase inflation. So, if there is one thing I expect for the next half year is probably a little bit of a tick-up in inflation. That is about it. How does your company strike a balance between driving innovation and complying with regulations in Nigeria’s rapidly evolving fintech industry?Regulation makes operations easier. Because if you think about a totally unregulated space, that means anybody can do anything. And then if anybody can do anything, every single time the end user has a dispute. That dispute will end up in court, and it will be left to the courts to actually go ahead and decide who, what, and where. And that entire process is expensive and time-consuming. So, if you are a fintech, dealing with thousands of customers, and one per cent of them should sue you. What happens? So, when you have thoughtful regulation, it basically tells everybody what the guard rails are. It gives you the rules of the guard rails. And once you follow those guard rails, it is clear that only things that are outside those guard rails will cost you any peril. So, regulation does not stop innovation. It just lets you understand how you play.Although the economy has achieved some stability, challenges such as inflation and exchange rate volatility persist. What role can fintech companies play in helping businesses and consumers navigate these pressures?Fintechs have no power in this. They have no power to do anything about this. What they can do on their side is structure their business in such a way that depreciation of the naira and high interest rates do not affect them. On the other side, when you talk about their customers, what can they do to help their customers? Very little. Remember, fintechs are price takers when it comes to the funds that they facilitate the lending of, and when it comes to any deposits that they are able to attract. So, there is really not much that they can do.So, how can they help small businesses?It is just being able to continue to lend through that process. So, what you will find is banks get to a point where they say, because of the economic situation, we are going to wind down our books. And when they say they are going to wind down their books, all it means is that they are going to go out and call loans. What fintechs can do is, because they are iterative, they can continue to iterate price risk intelligently so that those banks that have partnered with them can continue to lend with confidence.Looking back over the past seven years, what would you consider Mathesis’s biggest achievements and milestones?In the last seven years, we have facilitated about 8.5 million loans, about $260m. We have facilitated lending to about 2.7 million individual borrowers. We have been able to go out and provide credit to people; the vast majority of our customers come to us through USSD, which is a group that has been severely underserved in Africa.What is your vision for Mathesis over the next decade?We live in a world where ten years is forever. Ten years is if you think back ten years, it is like going into the Stone Age. If we look at the next ten years, our goal is to be the major decision engine that handles any conversation where payment and fulfilment differ across Africa. And let me explain what that means. If I go out and I pay for a car, the man says he will bring the car in two weeks. There is risk in that. Our goal is that before you make that decision, you take that guy’s information, you are going to run it through us, and we will give you the probability that he will run away with the car. Then you can make an intelligent decision if you should give him the money for that. And it is the same thing in insurance. Somebody comes today when you go to buy insurance; they just give you one number. Everybody comes and says five per cent. You fight them and say it is 2.5 per cent. However, the two of you should never get to the same rate because if I dig into your life, I should be able to find out who you are and score that and do the same for you and score that. So, if I am the insurance company, I will say you are a proper man. You do not have issues. You do not owe anybody. And because you do not owe anybody, I think you will be a good risk. And I say to the other person and say your look is disturbing; you are a high risk. The goal is that we are there every time anybody wants to make a decision. Insurance, individual, real estate, banks, etc. We help you decide if you should take on that risk.How does Mathesis differ from traditional credit bureaus?So, credit bureaus are like the post office. So, every institution has a box. And inside that box, there are individuals in it. So, anytime the person does a transaction, you take it and put it in that box. And Nigeria’s credit bureau has become negative only. Which is, no matter what you do when you are paying, they do not bother; they do not bother going to put your name in the credit bureau. The day you do not pay, they are going to put your name in the credit bureau as a bad lender. So, what they do is mechanical. They are just collating data. Some of them are just selling scores, but the predictive value is pretty low. What we do is the predictive value side. We do not run around. That is not what we do. What we do is we work with institutions to take all the data that they currently have and give them an output that has real predictive value on how each particular borrower they take out of this pool works. How each particular person is most likely to behave. And again, there is no magic to it. Do some people who have high scores default? It happens. But if you look at it over time, over the population. We get it right more often than we get it wrong.The Minister of Finance recently argued that Nigeria’s rising public debt is largely a consequence of currency devaluation rather than new borrowing by the current administration. What is your assessment of that position?Does devaluation of currency make sense? Yes, it does. It does make sense because if you take the current exchange rate and apply it, if you go back five years and you take that exchange rate and apply it, you get a different number. So, is that part of it? I am sure it is. Now, is that all it is? Probably not. The good thing is the vast majority of our borrowing has been internal. So, it has been naira-based. You do not have to worry too much. Not that you do not have to worry about it, but at least it is serviceable. So, let us look at it this way. If they were going to borrow to buy this laptop three years ago, it would be X. If they try to buy this laptop today and they borrow money to do it, it would be five times that amount. So, as I said, what he said is true, but as with the finances of anybody’s house, the finances of the country are nuanced. So, making a proclamation, this is why it happened. No. It is probably not true. You have to look at the entire process. Well, if you say that is why it happened, and the question is, why did you not increase taxes here? So, there are so many levels. So, I personally tend not to listen to those things. Nine times out of ten, if I want to understand nuanced positions, I look for people that are speaking not from a political podium, but more from an academic podium because academics tend to just talk. They have nothing to lose. They have no agenda.Do you believe the naira has reached its fair market value?Given the level of growth that we are seeing in the country, I think long term if the growth levels do not get better, the naira is going to continue to depreciate. But given that now it is free floating, I think the pace of the depreciation would be quite low. And we will see spikes up as we go along the way. So, if you look at recent history when we had a managed process, the problem with the managed process is like you take a balloon, fill it with air, and you start squeezing it on one side. After you squeeze it, it will get to a point where it will just explode. That is those crazy devaluations we used to see. We are not going to see them going forward. I think until the level of growth increases, we are going to see general depreciation going forward.What is your outlook for the economy in the second half of the year?I think it will be no different from the first part. The only thing that concerns me is that everything that is going on in the Middle East is not getting better; it is getting worse. And if it continues to get worse, the price of energy will go up. And if the price of energy goes up, that is just going to flow into everything. So, inflation might get a little higher. So, but aside from that, I do not see anything. Everybody is looking forward to election spending, but the election spending is just going to help increase inflation. So, if there is one thing I expect for the next half year is probably a little bit of a tick-up in inflation. That is about it. Regulation makes operations easier. Because if you think about a totally unregulated space, that means anybody can do anything. And then if anybody can do anything, every single time the end user has a dispute. That dispute will end up in court, and it will be left to the courts to actually go ahead and decide who, what, and where. And that entire process is expensive and time-consuming. So, if you are a fintech, dealing with thousands of customers, and one per cent of them should sue you. What happens? So, when you have thoughtful regulation, it basically tells everybody what the guard rails are. It gives you the rules of the guard rails. And once you follow those guard rails, it is clear that only things that are outside those guard rails will cost you any peril. So, regulation does not stop innovation. It just lets you understand how you play.Although the economy has achieved some stability, challenges such as inflation and exchange rate volatility persist. What role can fintech companies play in helping businesses and consumers navigate these pressures?Fintechs have no power in this. They have no power to do anything about this. What they can do on their side is structure their business in such a way that depreciation of the naira and high interest rates do not affect them. On the other side, when you talk about their customers, what can they do to help their customers? Very little. Remember, fintechs are price takers when it comes to the funds that they facilitate the lending of, and when it comes to any deposits that they are able to attract. So, there is really not much that they can do.So, how can they help small businesses?It is just being able to continue to lend through that process. So, what you will find is banks get to a point where they say, because of the economic situation, we are going to wind down our books. And when they say they are going to wind down their books, all it means is that they are going to go out and call loans. What fintechs can do is, because they are iterative, they can continue to iterate price risk intelligently so that those banks that have partnered with them can continue to lend with confidence.Looking back over the past seven years, what would you consider Mathesis’s biggest achievements and milestones?In the last seven years, we have facilitated about 8.5 million loans, about $260m. We have facilitated lending to about 2.7 million individual borrowers. We have been able to go out and provide credit to people; the vast majority of our customers come to us through USSD, which is a group that has been severely underserved in Africa.What is your vision for Mathesis over the next decade?We live in a world where ten years is forever. Ten years is if you think back ten years, it is like going into the Stone Age. If we look at the next ten years, our goal is to be the major decision engine that handles any conversation where payment and fulfilment differ across Africa. And let me explain what that means. If I go out and I pay for a car, the man says he will bring the car in two weeks. There is risk in that. Our goal is that before you make that decision, you take that guy’s information, you are going to run it through us, and we will give you the probability that he will run away with the car. Then you can make an intelligent decision if you should give him the money for that. And it is the same thing in insurance. Somebody comes today when you go to buy insurance; they just give you one number. Everybody comes and says five per cent. You fight them and say it is 2.5 per cent. However, the two of you should never get to the same rate because if I dig into your life, I should be able to find out who you are and score that and do the same for you and score that. So, if I am the insurance company, I will say you are a proper man. You do not have issues. You do not owe anybody. And because you do not owe anybody, I think you will be a good risk. And I say to the other person and say your look is disturbing; you are a high risk. The goal is that we are there every time anybody wants to make a decision. Insurance, individual, real estate, banks, etc. We help you decide if you should take on that risk.How does Mathesis differ from traditional credit bureaus?So, credit bureaus are like the post office. So, every institution has a box. And inside that box, there are individuals in it. So, anytime the person does a transaction, you take it and put it in that box. And Nigeria’s credit bureau has become negative only. Which is, no matter what you do when you are paying, they do not bother; they do not bother going to put your name in the credit bureau. The day you do not pay, they are going to put your name in the credit bureau as a bad lender. So, what they do is mechanical. They are just collating data. Some of them are just selling scores, but the predictive value is pretty low. What we do is the predictive value side. We do not run around. That is not what we do. What we do is we work with institutions to take all the data that they currently have and give them an output that has real predictive value on how each particular borrower they take out of this pool works. How each particular person is most likely to behave. And again, there is no magic to it. Do some people who have high scores default? It happens. But if you look at it over time, over the population. We get it right more often than we get it wrong.The Minister of Finance recently argued that Nigeria’s rising public debt is largely a consequence of currency devaluation rather than new borrowing by the current administration. What is your assessment of that position?Does devaluation of currency make sense? Yes, it does. It does make sense because if you take the current exchange rate and apply it, if you go back five years and you take that exchange rate and apply it, you get a different number. So, is that part of it? I am sure it is. Now, is that all it is? Probably not. The good thing is the vast majority of our borrowing has been internal. So, it has been naira-based. You do not have to worry too much. Not that you do not have to worry about it, but at least it is serviceable. So, let us look at it this way. If they were going to borrow to buy this laptop three years ago, it would be X. If they try to buy this laptop today and they borrow money to do it, it would be five times that amount. So, as I said, what he said is true, but as with the finances of anybody’s house, the finances of the country are nuanced. So, making a proclamation, this is why it happened. No. It is probably not true. You have to look at the entire process. Well, if you say that is why it happened, and the question is, why did you not increase taxes here? So, there are so many levels. So, I personally tend not to listen to those things. Nine times out of ten, if I want to understand nuanced positions, I look for people that are speaking not from a political podium, but more from an academic podium because academics tend to just talk. They have nothing to lose. They have no agenda.Do you believe the naira has reached its fair market value?Given the level of growth that we are seeing in the country, I think long term if the growth levels do not get better, the naira is going to continue to depreciate. But given that now it is free floating, I think the pace of the depreciation would be quite low. And we will see spikes up as we go along the way. So, if you look at recent history when we had a managed process, the problem with the managed process is like you take a balloon, fill it with air, and you start squeezing it on one side. After you squeeze it, it will get to a point where it will just explode. That is those crazy devaluations we used to see. We are not going to see them going forward. I think until the level of growth increases, we are going to see general depreciation going forward.What is your outlook for the economy in the second half of the year?I think it will be no different from the first part. The only thing that concerns me is that everything that is going on in the Middle East is not getting better; it is getting worse. And if it continues to get worse, the price of energy will go up. And if the price of energy goes up, that is just going to flow into everything. So, inflation might get a little higher. So, but aside from that, I do not see anything. Everybody is looking forward to election spending, but the election spending is just going to help increase inflation. So, if there is one thing I expect for the next half year is probably a little bit of a tick-up in inflation. That is about it. Although the economy has achieved some stability, challenges such as inflation and exchange rate volatility persist. What role can fintech companies play in helping businesses and consumers navigate these pressures?Fintechs have no power in this. They have no power to do anything about this. What they can do on their side is structure their business in such a way that depreciation of the naira and high interest rates do not affect them. On the other side, when you talk about their customers, what can they do to help their customers? Very little. Remember, fintechs are price takers when it comes to the funds that they facilitate the lending of, and when it comes to any deposits that they are able to attract. So, there is really not much that they can do.So, how can they help small businesses?It is just being able to continue to lend through that process. So, what you will find is banks get to a point where they say, because of the economic situation, we are going to wind down our books. And when they say they are going to wind down their books, all it means is that they are going to go out and call loans. What fintechs can do is, because they are iterative, they can continue to iterate price risk intelligently so that those banks that have partnered with them can continue to lend with confidence.Looking back over the past seven years, what would you consider Mathesis’s biggest achievements and milestones?In the last seven years, we have facilitated about 8.5 million loans, about $260m. We have facilitated lending to about 2.7 million individual borrowers. We have been able to go out and provide credit to people; the vast majority of our customers come to us through USSD, which is a group that has been severely underserved in Africa.What is your vision for Mathesis over the next decade?We live in a world where ten years is forever. Ten years is if you think back ten years, it is like going into the Stone Age. If we look at the next ten years, our goal is to be the major decision engine that handles any conversation where payment and fulfilment differ across Africa. And let me explain what that means. If I go out and I pay for a car, the man says he will bring the car in two weeks. There is risk in that. Our goal is that before you make that decision, you take that guy’s information, you are going to run it through us, and we will give you the probability that he will run away with the car. Then you can make an intelligent decision if you should give him the money for that. And it is the same thing in insurance. Somebody comes today when you go to buy insurance; they just give you one number. Everybody comes and says five per cent. You fight them and say it is 2.5 per cent. However, the two of you should never get to the same rate because if I dig into your life, I should be able to find out who you are and score that and do the same for you and score that. So, if I am the insurance company, I will say you are a proper man. You do not have issues. You do not owe anybody. And because you do not owe anybody, I think you will be a good risk. And I say to the other person and say your look is disturbing; you are a high risk. The goal is that we are there every time anybody wants to make a decision. Insurance, individual, real estate, banks, etc. We help you decide if you should take on that risk.How does Mathesis differ from traditional credit bureaus?So, credit bureaus are like the post office. So, every institution has a box. And inside that box, there are individuals in it. So, anytime the person does a transaction, you take it and put it in that box. And Nigeria’s credit bureau has become negative only. Which is, no matter what you do when you are paying, they do not bother; they do not bother going to put your name in the credit bureau. The day you do not pay, they are going to put your name in the credit bureau as a bad lender. So, what they do is mechanical. They are just collating data. Some of them are just selling scores, but the predictive value is pretty low. What we do is the predictive value side. We do not run around. That is not what we do. What we do is we work with institutions to take all the data that they currently have and give them an output that has real predictive value on how each particular borrower they take out of this pool works. How each particular person is most likely to behave. And again, there is no magic to it. Do some people who have high scores default? It happens. But if you look at it over time, over the population. We get it right more often than we get it wrong.The Minister of Finance recently argued that Nigeria’s rising public debt is largely a consequence of currency devaluation rather than new borrowing by the current administration. What is your assessment of that position?Does devaluation of currency make sense? Yes, it does. It does make sense because if you take the current exchange rate and apply it, if you go back five years and you take that exchange rate and apply it, you get a different number. So, is that part of it? I am sure it is. Now, is that all it is? Probably not. The good thing is the vast majority of our borrowing has been internal. So, it has been naira-based. You do not have to worry too much. Not that you do not have to worry about it, but at least it is serviceable. So, let us look at it this way. If they were going to borrow to buy this laptop three years ago, it would be X. If they try to buy this laptop today and they borrow money to do it, it would be five times that amount. So, as I said, what he said is true, but as with the finances of anybody’s house, the finances of the country are nuanced. So, making a proclamation, this is why it happened. No. It is probably not true. You have to look at the entire process. Well, if you say that is why it happened, and the question is, why did you not increase taxes here? So, there are so many levels. So, I personally tend not to listen to those things. Nine times out of ten, if I want to understand nuanced positions, I look for people that are speaking not from a political podium, but more from an academic podium because academics tend to just talk. They have nothing to lose. They have no agenda.Do you believe the naira has reached its fair market value?Given the level of growth that we are seeing in the country, I think long term if the growth levels do not get better, the naira is going to continue to depreciate. But given that now it is free floating, I think the pace of the depreciation would be quite low. And we will see spikes up as we go along the way. So, if you look at recent history when we had a managed process, the problem with the managed process is like you take a balloon, fill it with air, and you start squeezing it on one side. After you squeeze it, it will get to a point where it will just explode. That is those crazy devaluations we used to see. We are not going to see them going forward. I think until the level of growth increases, we are going to see general depreciation going forward.What is your outlook for the economy in the second half of the year?I think it will be no different from the first part. The only thing that concerns me is that everything that is going on in the Middle East is not getting better; it is getting worse. And if it continues to get worse, the price of energy will go up. And if the price of energy goes up, that is just going to flow into everything. So, inflation might get a little higher. So, but aside from that, I do not see anything. Everybody is looking forward to election spending, but the election spending is just going to help increase inflation. So, if there is one thing I expect for the next half year is probably a little bit of a tick-up in inflation. That is about it. Fintechs have no power in this. They have no power to do anything about this. What they can do on their side is structure their business in such a way that depreciation of the naira and high interest rates do not affect them. On the other side, when you talk about their customers, what can they do to help their customers? Very little. Remember, fintechs are price takers when it comes to the funds that they facilitate the lending of, and when it comes to any deposits that they are able to attract. So, there is really not much that they can do.So, how can they help small businesses?It is just being able to continue to lend through that process. So, what you will find is banks get to a point where they say, because of the economic situation, we are going to wind down our books. And when they say they are going to wind down their books, all it means is that they are going to go out and call loans. What fintechs can do is, because they are iterative, they can continue to iterate price risk intelligently so that those banks that have partnered with them can continue to lend with confidence.Looking back over the past seven years, what would you consider Mathesis’s biggest achievements and milestones?In the last seven years, we have facilitated about 8.5 million loans, about $260m. We have facilitated lending to about 2.7 million individual borrowers. We have been able to go out and provide credit to people; the vast majority of our customers come to us through USSD, which is a group that has been severely underserved in Africa.What is your vision for Mathesis over the next decade?We live in a world where ten years is forever. Ten years is if you think back ten years, it is like going into the Stone Age. If we look at the next ten years, our goal is to be the major decision engine that handles any conversation where payment and fulfilment differ across Africa. And let me explain what that means. If I go out and I pay for a car, the man says he will bring the car in two weeks. There is risk in that. Our goal is that before you make that decision, you take that guy’s information, you are going to run it through us, and we will give you the probability that he will run away with the car. Then you can make an intelligent decision if you should give him the money for that. And it is the same thing in insurance. Somebody comes today when you go to buy insurance; they just give you one number. Everybody comes and says five per cent. You fight them and say it is 2.5 per cent. However, the two of you should never get to the same rate because if I dig into your life, I should be able to find out who you are and score that and do the same for you and score that. So, if I am the insurance company, I will say you are a proper man. You do not have issues. You do not owe anybody. And because you do not owe anybody, I think you will be a good risk. And I say to the other person and say your look is disturbing; you are a high risk. The goal is that we are there every time anybody wants to make a decision. Insurance, individual, real estate, banks, etc. We help you decide if you should take on that risk.How does Mathesis differ from traditional credit bureaus?So, credit bureaus are like the post office. So, every institution has a box. And inside that box, there are individuals in it. So, anytime the person does a transaction, you take it and put it in that box. And Nigeria’s credit bureau has become negative only. Which is, no matter what you do when you are paying, they do not bother; they do not bother going to put your name in the credit bureau. The day you do not pay, they are going to put your name in the credit bureau as a bad lender. So, what they do is mechanical. They are just collating data. Some of them are just selling scores, but the predictive value is pretty low. What we do is the predictive value side. We do not run around. That is not what we do. What we do is we work with institutions to take all the data that they currently have and give them an output that has real predictive value on how each particular borrower they take out of this pool works. How each particular person is most likely to behave. And again, there is no magic to it. Do some people who have high scores default? It happens. But if you look at it over time, over the population. We get it right more often than we get it wrong.The Minister of Finance recently argued that Nigeria’s rising public debt is largely a consequence of currency devaluation rather than new borrowing by the current administration. What is your assessment of that position?Does devaluation of currency make sense? Yes, it does. It does make sense because if you take the current exchange rate and apply it, if you go back five years and you take that exchange rate and apply it, you get a different number. So, is that part of it? I am sure it is. Now, is that all it is? Probably not. The good thing is the vast majority of our borrowing has been internal. So, it has been naira-based. You do not have to worry too much. Not that you do not have to worry about it, but at least it is serviceable. So, let us look at it this way. If they were going to borrow to buy this laptop three years ago, it would be X. If they try to buy this laptop today and they borrow money to do it, it would be five times that amount. So, as I said, what he said is true, but as with the finances of anybody’s house, the finances of the country are nuanced. So, making a proclamation, this is why it happened. No. It is probably not true. You have to look at the entire process. Well, if you say that is why it happened, and the question is, why did you not increase taxes here? So, there are so many levels. So, I personally tend not to listen to those things. Nine times out of ten, if I want to understand nuanced positions, I look for people that are speaking not from a political podium, but more from an academic podium because academics tend to just talk. They have nothing to lose. They have no agenda.Do you believe the naira has reached its fair market value?Given the level of growth that we are seeing in the country, I think long term if the growth levels do not get better, the naira is going to continue to depreciate. But given that now it is free floating, I think the pace of the depreciation would be quite low. And we will see spikes up as we go along the way. So, if you look at recent history when we had a managed process, the problem with the managed process is like you take a balloon, fill it with air, and you start squeezing it on one side. After you squeeze it, it will get to a point where it will just explode. That is those crazy devaluations we used to see. We are not going to see them going forward. I think until the level of growth increases, we are going to see general depreciation going forward.What is your outlook for the economy in the second half of the year?I think it will be no different from the first part. The only thing that concerns me is that everything that is going on in the Middle East is not getting better; it is getting worse. And if it continues to get worse, the price of energy will go up. And if the price of energy goes up, that is just going to flow into everything. So, inflation might get a little higher. So, but aside from that, I do not see anything. Everybody is looking forward to election spending, but the election spending is just going to help increase inflation. So, if there is one thing I expect for the next half year is probably a little bit of a tick-up in inflation. That is about it. So, how can they help small businesses?It is just being able to continue to lend through that process. So, what you will find is banks get to a point where they say, because of the economic situation, we are going to wind down our books. And when they say they are going to wind down their books, all it means is that they are going to go out and call loans. What fintechs can do is, because they are iterative, they can continue to iterate price risk intelligently so that those banks that have partnered with them can continue to lend with confidence.Looking back over the past seven years, what would you consider Mathesis’s biggest achievements and milestones?In the last seven years, we have facilitated about 8.5 million loans, about $260m. We have facilitated lending to about 2.7 million individual borrowers. We have been able to go out and provide credit to people; the vast majority of our customers come to us through USSD, which is a group that has been severely underserved in Africa.What is your vision for Mathesis over the next decade?We live in a world where ten years is forever. Ten years is if you think back ten years, it is like going into the Stone Age. If we look at the next ten years, our goal is to be the major decision engine that handles any conversation where payment and fulfilment differ across Africa. And let me explain what that means. If I go out and I pay for a car, the man says he will bring the car in two weeks. There is risk in that. Our goal is that before you make that decision, you take that guy’s information, you are going to run it through us, and we will give you the probability that he will run away with the car. Then you can make an intelligent decision if you should give him the money for that. And it is the same thing in insurance. Somebody comes today when you go to buy insurance; they just give you one number. Everybody comes and says five per cent. You fight them and say it is 2.5 per cent. However, the two of you should never get to the same rate because if I dig into your life, I should be able to find out who you are and score that and do the same for you and score that. So, if I am the insurance company, I will say you are a proper man. You do not have issues. You do not owe anybody. And because you do not owe anybody, I think you will be a good risk. And I say to the other person and say your look is disturbing; you are a high risk. The goal is that we are there every time anybody wants to make a decision. Insurance, individual, real estate, banks, etc. We help you decide if you should take on that risk.How does Mathesis differ from traditional credit bureaus?So, credit bureaus are like the post office. So, every institution has a box. And inside that box, there are individuals in it. So, anytime the person does a transaction, you take it and put it in that box. And Nigeria’s credit bureau has become negative only. Which is, no matter what you do when you are paying, they do not bother; they do not bother going to put your name in the credit bureau. The day you do not pay, they are going to put your name in the credit bureau as a bad lender. So, what they do is mechanical. They are just collating data. Some of them are just selling scores, but the predictive value is pretty low. What we do is the predictive value side. We do not run around. That is not what we do. What we do is we work with institutions to take all the data that they currently have and give them an output that has real predictive value on how each particular borrower they take out of this pool works. How each particular person is most likely to behave. And again, there is no magic to it. Do some people who have high scores default? It happens. But if you look at it over time, over the population. We get it right more often than we get it wrong.The Minister of Finance recently argued that Nigeria’s rising public debt is largely a consequence of currency devaluation rather than new borrowing by the current administration. What is your assessment of that position?Does devaluation of currency make sense? Yes, it does. It does make sense because if you take the current exchange rate and apply it, if you go back five years and you take that exchange rate and apply it, you get a different number. So, is that part of it? I am sure it is. Now, is that all it is? Probably not. The good thing is the vast majority of our borrowing has been internal. So, it has been naira-based. You do not have to worry too much. Not that you do not have to worry about it, but at least it is serviceable. So, let us look at it this way. If they were going to borrow to buy this laptop three years ago, it would be X. If they try to buy this laptop today and they borrow money to do it, it would be five times that amount. So, as I said, what he said is true, but as with the finances of anybody’s house, the finances of the country are nuanced. So, making a proclamation, this is why it happened. No. It is probably not true. You have to look at the entire process. Well, if you say that is why it happened, and the question is, why did you not increase taxes here? So, there are so many levels. So, I personally tend not to listen to those things. Nine times out of ten, if I want to understand nuanced positions, I look for people that are speaking not from a political podium, but more from an academic podium because academics tend to just talk. They have nothing to lose. They have no agenda.Do you believe the naira has reached its fair market value?Given the level of growth that we are seeing in the country, I think long term if the growth levels do not get better, the naira is going to continue to depreciate. But given that now it is free floating, I think the pace of the depreciation would be quite low. And we will see spikes up as we go along the way. So, if you look at recent history when we had a managed process, the problem with the managed process is like you take a balloon, fill it with air, and you start squeezing it on one side. After you squeeze it, it will get to a point where it will just explode. That is those crazy devaluations we used to see. We are not going to see them going forward. I think until the level of growth increases, we are going to see general depreciation going forward.What is your outlook for the economy in the second half of the year?I think it will be no different from the first part. The only thing that concerns me is that everything that is going on in the Middle East is not getting better; it is getting worse. And if it continues to get worse, the price of energy will go up. And if the price of energy goes up, that is just going to flow into everything. So, inflation might get a little higher. So, but aside from that, I do not see anything. Everybody is looking forward to election spending, but the election spending is just going to help increase inflation. So, if there is one thing I expect for the next half year is probably a little bit of a tick-up in inflation. That is about it. It is just being able to continue to lend through that process. So, what you will find is banks get to a point where they say, because of the economic situation, we are going to wind down our books. And when they say they are going to wind down their books, all it means is that they are going to go out and call loans. What fintechs can do is, because they are iterative, they can continue to iterate price risk intelligently so that those banks that have partnered with them can continue to lend with confidence.Looking back over the past seven years, what would you consider Mathesis’s biggest achievements and milestones?In the last seven years, we have facilitated about 8.5 million loans, about $260m. We have facilitated lending to about 2.7 million individual borrowers. We have been able to go out and provide credit to people; the vast majority of our customers come to us through USSD, which is a group that has been severely underserved in Africa.What is your vision for Mathesis over the next decade?We live in a world where ten years is forever. Ten years is if you think back ten years, it is like going into the Stone Age. If we look at the next ten years, our goal is to be the major decision engine that handles any conversation where payment and fulfilment differ across Africa. And let me explain what that means. If I go out and I pay for a car, the man says he will bring the car in two weeks. There is risk in that. Our goal is that before you make that decision, you take that guy’s information, you are going to run it through us, and we will give you the probability that he will run away with the car. Then you can make an intelligent decision if you should give him the money for that. And it is the same thing in insurance. Somebody comes today when you go to buy insurance; they just give you one number. Everybody comes and says five per cent. You fight them and say it is 2.5 per cent. However, the two of you should never get to the same rate because if I dig into your life, I should be able to find out who you are and score that and do the same for you and score that. So, if I am the insurance company, I will say you are a proper man. You do not have issues. You do not owe anybody. And because you do not owe anybody, I think you will be a good risk. And I say to the other person and say your look is disturbing; you are a high risk. The goal is that we are there every time anybody wants to make a decision. Insurance, individual, real estate, banks, etc. We help you decide if you should take on that risk.How does Mathesis differ from traditional credit bureaus?So, credit bureaus are like the post office. So, every institution has a box. And inside that box, there are individuals in it. So, anytime the person does a transaction, you take it and put it in that box. And Nigeria’s credit bureau has become negative only. Which is, no matter what you do when you are paying, they do not bother; they do not bother going to put your name in the credit bureau. The day you do not pay, they are going to put your name in the credit bureau as a bad lender. So, what they do is mechanical. They are just collating data. Some of them are just selling scores, but the predictive value is pretty low. What we do is the predictive value side. We do not run around. That is not what we do. What we do is we work with institutions to take all the data that they currently have and give them an output that has real predictive value on how each particular borrower they take out of this pool works. How each particular person is most likely to behave. And again, there is no magic to it. Do some people who have high scores default? It happens. But if you look at it over time, over the population. We get it right more often than we get it wrong.The Minister of Finance recently argued that Nigeria’s rising public debt is largely a consequence of currency devaluation rather than new borrowing by the current administration. What is your assessment of that position?Does devaluation of currency make sense? Yes, it does. It does make sense because if you take the current exchange rate and apply it, if you go back five years and you take that exchange rate and apply it, you get a different number. So, is that part of it? I am sure it is. Now, is that all it is? Probably not. The good thing is the vast majority of our borrowing has been internal. So, it has been naira-based. You do not have to worry too much. Not that you do not have to worry about it, but at least it is serviceable. So, let us look at it this way. If they were going to borrow to buy this laptop three years ago, it would be X. If they try to buy this laptop today and they borrow money to do it, it would be five times that amount. So, as I said, what he said is true, but as with the finances of anybody’s house, the finances of the country are nuanced. So, making a proclamation, this is why it happened. No. It is probably not true. You have to look at the entire process. Well, if you say that is why it happened, and the question is, why did you not increase taxes here? So, there are so many levels. So, I personally tend not to listen to those things. Nine times out of ten, if I want to understand nuanced positions, I look for people that are speaking not from a political podium, but more from an academic podium because academics tend to just talk. They have nothing to lose. They have no agenda.Do you believe the naira has reached its fair market value?Given the level of growth that we are seeing in the country, I think long term if the growth levels do not get better, the naira is going to continue to depreciate. But given that now it is free floating, I think the pace of the depreciation would be quite low. And we will see spikes up as we go along the way. So, if you look at recent history when we had a managed process, the problem with the managed process is like you take a balloon, fill it with air, and you start squeezing it on one side. After you squeeze it, it will get to a point where it will just explode. That is those crazy devaluations we used to see. We are not going to see them going forward. I think until the level of growth increases, we are going to see general depreciation going forward.What is your outlook for the economy in the second half of the year?I think it will be no different from the first part. The only thing that concerns me is that everything that is going on in the Middle East is not getting better; it is getting worse. And if it continues to get worse, the price of energy will go up. And if the price of energy goes up, that is just going to flow into everything. So, inflation might get a little higher. So, but aside from that, I do not see anything. Everybody is looking forward to election spending, but the election spending is just going to help increase inflation. So, if there is one thing I expect for the next half year is probably a little bit of a tick-up in inflation. That is about it. Looking back over the past seven years, what would you consider Mathesis’s biggest achievements and milestones?In the last seven years, we have facilitated about 8.5 million loans, about $260m. We have facilitated lending to about 2.7 million individual borrowers. We have been able to go out and provide credit to people; the vast majority of our customers come to us through USSD, which is a group that has been severely underserved in Africa.What is your vision for Mathesis over the next decade?We live in a world where ten years is forever. Ten years is if you think back ten years, it is like going into the Stone Age. If we look at the next ten years, our goal is to be the major decision engine that handles any conversation where payment and fulfilment differ across Africa. And let me explain what that means. If I go out and I pay for a car, the man says he will bring the car in two weeks. There is risk in that. Our goal is that before you make that decision, you take that guy’s information, you are going to run it through us, and we will give you the probability that he will run away with the car. Then you can make an intelligent decision if you should give him the money for that. And it is the same thing in insurance. Somebody comes today when you go to buy insurance; they just give you one number. Everybody comes and says five per cent. You fight them and say it is 2.5 per cent. However, the two of you should never get to the same rate because if I dig into your life, I should be able to find out who you are and score that and do the same for you and score that. So, if I am the insurance company, I will say you are a proper man. You do not have issues. You do not owe anybody. And because you do not owe anybody, I think you will be a good risk. And I say to the other person and say your look is disturbing; you are a high risk. The goal is that we are there every time anybody wants to make a decision. Insurance, individual, real estate, banks, etc. We help you decide if you should take on that risk.How does Mathesis differ from traditional credit bureaus?So, credit bureaus are like the post office. So, every institution has a box. And inside that box, there are individuals in it. So, anytime the person does a transaction, you take it and put it in that box. And Nigeria’s credit bureau has become negative only. Which is, no matter what you do when you are paying, they do not bother; they do not bother going to put your name in the credit bureau. The day you do not pay, they are going to put your name in the credit bureau as a bad lender. So, what they do is mechanical. They are just collating data. Some of them are just selling scores, but the predictive value is pretty low. What we do is the predictive value side. We do not run around. That is not what we do. What we do is we work with institutions to take all the data that they currently have and give them an output that has real predictive value on how each particular borrower they take out of this pool works. How each particular person is most likely to behave. And again, there is no magic to it. Do some people who have high scores default? It happens. But if you look at it over time, over the population. We get it right more often than we get it wrong.The Minister of Finance recently argued that Nigeria’s rising public debt is largely a consequence of currency devaluation rather than new borrowing by the current administration. What is your assessment of that position?Does devaluation of currency make sense? Yes, it does. It does make sense because if you take the current exchange rate and apply it, if you go back five years and you take that exchange rate and apply it, you get a different number. So, is that part of it? I am sure it is. Now, is that all it is? Probably not. The good thing is the vast majority of our borrowing has been internal. So, it has been naira-based. You do not have to worry too much. Not that you do not have to worry about it, but at least it is serviceable. So, let us look at it this way. If they were going to borrow to buy this laptop three years ago, it would be X. If they try to buy this laptop today and they borrow money to do it, it would be five times that amount. So, as I said, what he said is true, but as with the finances of anybody’s house, the finances of the country are nuanced. So, making a proclamation, this is why it happened. No. It is probably not true. You have to look at the entire process. Well, if you say that is why it happened, and the question is, why did you not increase taxes here? So, there are so many levels. So, I personally tend not to listen to those things. Nine times out of ten, if I want to understand nuanced positions, I look for people that are speaking not from a political podium, but more from an academic podium because academics tend to just talk. They have nothing to lose. They have no agenda.Do you believe the naira has reached its fair market value?Given the level of growth that we are seeing in the country, I think long term if the growth levels do not get better, the naira is going to continue to depreciate. But given that now it is free floating, I think the pace of the depreciation would be quite low. And we will see spikes up as we go along the way. So, if you look at recent history when we had a managed process, the problem with the managed process is like you take a balloon, fill it with air, and you start squeezing it on one side. After you squeeze it, it will get to a point where it will just explode. That is those crazy devaluations we used to see. We are not going to see them going forward. I think until the level of growth increases, we are going to see general depreciation going forward.What is your outlook for the economy in the second half of the year?I think it will be no different from the first part. The only thing that concerns me is that everything that is going on in the Middle East is not getting better; it is getting worse. And if it continues to get worse, the price of energy will go up. And if the price of energy goes up, that is just going to flow into everything. So, inflation might get a little higher. So, but aside from that, I do not see anything. Everybody is looking forward to election spending, but the election spending is just going to help increase inflation. So, if there is one thing I expect for the next half year is probably a little bit of a tick-up in inflation. That is about it. In the last seven years, we have facilitated about 8.5 million loans, about $260m. We have facilitated lending to about 2.7 million individual borrowers. We have been able to go out and provide credit to people; the vast majority of our customers come to us through USSD, which is a group that has been severely underserved in Africa.What is your vision for Mathesis over the next decade?We live in a world where ten years is forever. Ten years is if you think back ten years, it is like going into the Stone Age. If we look at the next ten years, our goal is to be the major decision engine that handles any conversation where payment and fulfilment differ across Africa. And let me explain what that means. If I go out and I pay for a car, the man says he will bring the car in two weeks. There is risk in that. Our goal is that before you make that decision, you take that guy’s information, you are going to run it through us, and we will give you the probability that he will run away with the car. Then you can make an intelligent decision if you should give him the money for that. And it is the same thing in insurance. Somebody comes today when you go to buy insurance; they just give you one number. Everybody comes and says five per cent. You fight them and say it is 2.5 per cent. However, the two of you should never get to the same rate because if I dig into your life, I should be able to find out who you are and score that and do the same for you and score that. So, if I am the insurance company, I will say you are a proper man. You do not have issues. You do not owe anybody. And because you do not owe anybody, I think you will be a good risk. And I say to the other person and say your look is disturbing; you are a high risk. The goal is that we are there every time anybody wants to make a decision. Insurance, individual, real estate, banks, etc. We help you decide if you should take on that risk.How does Mathesis differ from traditional credit bureaus?So, credit bureaus are like the post office. So, every institution has a box. And inside that box, there are individuals in it. So, anytime the person does a transaction, you take it and put it in that box. And Nigeria’s credit bureau has become negative only. Which is, no matter what you do when you are paying, they do not bother; they do not bother going to put your name in the credit bureau. The day you do not pay, they are going to put your name in the credit bureau as a bad lender. So, what they do is mechanical. They are just collating data. Some of them are just selling scores, but the predictive value is pretty low. What we do is the predictive value side. We do not run around. That is not what we do. What we do is we work with institutions to take all the data that they currently have and give them an output that has real predictive value on how each particular borrower they take out of this pool works. How each particular person is most likely to behave. And again, there is no magic to it. Do some people who have high scores default? It happens. But if you look at it over time, over the population. We get it right more often than we get it wrong.The Minister of Finance recently argued that Nigeria’s rising public debt is largely a consequence of currency devaluation rather than new borrowing by the current administration. What is your assessment of that position?Does devaluation of currency make sense? Yes, it does. It does make sense because if you take the current exchange rate and apply it, if you go back five years and you take that exchange rate and apply it, you get a different number. So, is that part of it? I am sure it is. Now, is that all it is? Probably not. The good thing is the vast majority of our borrowing has been internal. So, it has been naira-based. You do not have to worry too much. Not that you do not have to worry about it, but at least it is serviceable. So, let us look at it this way. If they were going to borrow to buy this laptop three years ago, it would be X. If they try to buy this laptop today and they borrow money to do it, it would be five times that amount. So, as I said, what he said is true, but as with the finances of anybody’s house, the finances of the country are nuanced. So, making a proclamation, this is why it happened. No. It is probably not true. You have to look at the entire process. Well, if you say that is why it happened, and the question is, why did you not increase taxes here? So, there are so many levels. So, I personally tend not to listen to those things. Nine times out of ten, if I want to understand nuanced positions, I look for people that are speaking not from a political podium, but more from an academic podium because academics tend to just talk. They have nothing to lose. They have no agenda.Do you believe the naira has reached its fair market value?Given the level of growth that we are seeing in the country, I think long term if the growth levels do not get better, the naira is going to continue to depreciate. But given that now it is free floating, I think the pace of the depreciation would be quite low. And we will see spikes up as we go along the way. So, if you look at recent history when we had a managed process, the problem with the managed process is like you take a balloon, fill it with air, and you start squeezing it on one side. After you squeeze it, it will get to a point where it will just explode. That is those crazy devaluations we used to see. We are not going to see them going forward. I think until the level of growth increases, we are going to see general depreciation going forward.What is your outlook for the economy in the second half of the year?I think it will be no different from the first part. The only thing that concerns me is that everything that is going on in the Middle East is not getting better; it is getting worse. And if it continues to get worse, the price of energy will go up. And if the price of energy goes up, that is just going to flow into everything. So, inflation might get a little higher. So, but aside from that, I do not see anything. Everybody is looking forward to election spending, but the election spending is just going to help increase inflation. So, if there is one thing I expect for the next half year is probably a little bit of a tick-up in inflation. That is about it. What is your vision for Mathesis over the next decade?We live in a world where ten years is forever. Ten years is if you think back ten years, it is like going into the Stone Age. If we look at the next ten years, our goal is to be the major decision engine that handles any conversation where payment and fulfilment differ across Africa. And let me explain what that means. If I go out and I pay for a car, the man says he will bring the car in two weeks. There is risk in that. Our goal is that before you make that decision, you take that guy’s information, you are going to run it through us, and we will give you the probability that he will run away with the car. Then you can make an intelligent decision if you should give him the money for that. And it is the same thing in insurance. Somebody comes today when you go to buy insurance; they just give you one number. Everybody comes and says five per cent. You fight them and say it is 2.5 per cent. However, the two of you should never get to the same rate because if I dig into your life, I should be able to find out who you are and score that and do the same for you and score that. So, if I am the insurance company, I will say you are a proper man. You do not have issues. You do not owe anybody. And because you do not owe anybody, I think you will be a good risk. And I say to the other person and say your look is disturbing; you are a high risk. The goal is that we are there every time anybody wants to make a decision. Insurance, individual, real estate, banks, etc. We help you decide if you should take on that risk.How does Mathesis differ from traditional credit bureaus?So, credit bureaus are like the post office. So, every institution has a box. And inside that box, there are individuals in it. So, anytime the person does a transaction, you take it and put it in that box. And Nigeria’s credit bureau has become negative only. Which is, no matter what you do when you are paying, they do not bother; they do not bother going to put your name in the credit bureau. The day you do not pay, they are going to put your name in the credit bureau as a bad lender. So, what they do is mechanical. They are just collating data. Some of them are just selling scores, but the predictive value is pretty low. What we do is the predictive value side. We do not run around. That is not what we do. What we do is we work with institutions to take all the data that they currently have and give them an output that has real predictive value on how each particular borrower they take out of this pool works. How each particular person is most likely to behave. And again, there is no magic to it. Do some people who have high scores default? It happens. But if you look at it over time, over the population. We get it right more often than we get it wrong.The Minister of Finance recently argued that Nigeria’s rising public debt is largely a consequence of currency devaluation rather than new borrowing by the current administration. What is your assessment of that position?Does devaluation of currency make sense? Yes, it does. It does make sense because if you take the current exchange rate and apply it, if you go back five years and you take that exchange rate and apply it, you get a different number. So, is that part of it? I am sure it is. Now, is that all it is? Probably not. The good thing is the vast majority of our borrowing has been internal. So, it has been naira-based. You do not have to worry too much. Not that you do not have to worry about it, but at least it is serviceable. So, let us look at it this way. If they were going to borrow to buy this laptop three years ago, it would be X. If they try to buy this laptop today and they borrow money to do it, it would be five times that amount. So, as I said, what he said is true, but as with the finances of anybody’s house, the finances of the country are nuanced. So, making a proclamation, this is why it happened. No. It is probably not true. You have to look at the entire process. Well, if you say that is why it happened, and the question is, why did you not increase taxes here? So, there are so many levels. So, I personally tend not to listen to those things. Nine times out of ten, if I want to understand nuanced positions, I look for people that are speaking not from a political podium, but more from an academic podium because academics tend to just talk. They have nothing to lose. They have no agenda.Do you believe the naira has reached its fair market value?Given the level of growth that we are seeing in the country, I think long term if the growth levels do not get better, the naira is going to continue to depreciate. But given that now it is free floating, I think the pace of the depreciation would be quite low. And we will see spikes up as we go along the way. So, if you look at recent history when we had a managed process, the problem with the managed process is like you take a balloon, fill it with air, and you start squeezing it on one side. After you squeeze it, it will get to a point where it will just explode. That is those crazy devaluations we used to see. We are not going to see them going forward. I think until the level of growth increases, we are going to see general depreciation going forward.What is your outlook for the economy in the second half of the year?I think it will be no different from the first part. The only thing that concerns me is that everything that is going on in the Middle East is not getting better; it is getting worse. And if it continues to get worse, the price of energy will go up. And if the price of energy goes up, that is just going to flow into everything. So, inflation might get a little higher. So, but aside from that, I do not see anything. Everybody is looking forward to election spending, but the election spending is just going to help increase inflation. So, if there is one thing I expect for the next half year is probably a little bit of a tick-up in inflation. That is about it. We live in a world where ten years is forever. Ten years is if you think back ten years, it is like going into the Stone Age. If we look at the next ten years, our goal is to be the major decision engine that handles any conversation where payment and fulfilment differ across Africa. And let me explain what that means. If I go out and I pay for a car, the man says he will bring the car in two weeks. There is risk in that. Our goal is that before you make that decision, you take that guy’s information, you are going to run it through us, and we will give you the probability that he will run away with the car. Then you can make an intelligent decision if you should give him the money for that. And it is the same thing in insurance. Somebody comes today when you go to buy insurance; they just give you one number. Everybody comes and says five per cent. You fight them and say it is 2.5 per cent. However, the two of you should never get to the same rate because if I dig into your life, I should be able to find out who you are and score that and do the same for you and score that. So, if I am the insurance company, I will say you are a proper man. You do not have issues. You do not owe anybody. And because you do not owe anybody, I think you will be a good risk. And I say to the other person and say your look is disturbing; you are a high risk. The goal is that we are there every time anybody wants to make a decision. Insurance, individual, real estate, banks, etc. We help you decide if you should take on that risk.How does Mathesis differ from traditional credit bureaus?So, credit bureaus are like the post office. So, every institution has a box. And inside that box, there are individuals in it. So, anytime the person does a transaction, you take it and put it in that box. And Nigeria’s credit bureau has become negative only. Which is, no matter what you do when you are paying, they do not bother; they do not bother going to put your name in the credit bureau. The day you do not pay, they are going to put your name in the credit bureau as a bad lender. So, what they do is mechanical. They are just collating data. Some of them are just selling scores, but the predictive value is pretty low. What we do is the predictive value side. We do not run around. That is not what we do. What we do is we work with institutions to take all the data that they currently have and give them an output that has real predictive value on how each particular borrower they take out of this pool works. How each particular person is most likely to behave. And again, there is no magic to it. Do some people who have high scores default? It happens. But if you look at it over time, over the population. We get it right more often than we get it wrong.The Minister of Finance recently argued that Nigeria’s rising public debt is largely a consequence of currency devaluation rather than new borrowing by the current administration. What is your assessment of that position?Does devaluation of currency make sense? Yes, it does. It does make sense because if you take the current exchange rate and apply it, if you go back five years and you take that exchange rate and apply it, you get a different number. So, is that part of it? I am sure it is. Now, is that all it is? Probably not. The good thing is the vast majority of our borrowing has been internal. So, it has been naira-based. You do not have to worry too much. Not that you do not have to worry about it, but at least it is serviceable. So, let us look at it this way. If they were going to borrow to buy this laptop three years ago, it would be X. If they try to buy this laptop today and they borrow money to do it, it would be five times that amount. So, as I said, what he said is true, but as with the finances of anybody’s house, the finances of the country are nuanced. So, making a proclamation, this is why it happened. No. It is probably not true. You have to look at the entire process. Well, if you say that is why it happened, and the question is, why did you not increase taxes here? So, there are so many levels. So, I personally tend not to listen to those things. Nine times out of ten, if I want to understand nuanced positions, I look for people that are speaking not from a political podium, but more from an academic podium because academics tend to just talk. They have nothing to lose. They have no agenda.Do you believe the naira has reached its fair market value?Given the level of growth that we are seeing in the country, I think long term if the growth levels do not get better, the naira is going to continue to depreciate. But given that now it is free floating, I think the pace of the depreciation would be quite low. And we will see spikes up as we go along the way. So, if you look at recent history when we had a managed process, the problem with the managed process is like you take a balloon, fill it with air, and you start squeezing it on one side. After you squeeze it, it will get to a point where it will just explode. That is those crazy devaluations we used to see. We are not going to see them going forward. I think until the level of growth increases, we are going to see general depreciation going forward.What is your outlook for the economy in the second half of the year?I think it will be no different from the first part. The only thing that concerns me is that everything that is going on in the Middle East is not getting better; it is getting worse. And if it continues to get worse, the price of energy will go up. And if the price of energy goes up, that is just going to flow into everything. So, inflation might get a little higher. So, but aside from that, I do not see anything. Everybody is looking forward to election spending, but the election spending is just going to help increase inflation. So, if there is one thing I expect for the next half year is probably a little bit of a tick-up in inflation. That is about it. How does Mathesis differ from traditional credit bureaus?So, credit bureaus are like the post office. So, every institution has a box. And inside that box, there are individuals in it. So, anytime the person does a transaction, you take it and put it in that box. And Nigeria’s credit bureau has become negative only. Which is, no matter what you do when you are paying, they do not bother; they do not bother going to put your name in the credit bureau. The day you do not pay, they are going to put your name in the credit bureau as a bad lender. So, what they do is mechanical. They are just collating data. Some of them are just selling scores, but the predictive value is pretty low. What we do is the predictive value side. We do not run around. That is not what we do. What we do is we work with institutions to take all the data that they currently have and give them an output that has real predictive value on how each particular borrower they take out of this pool works. How each particular person is most likely to behave. And again, there is no magic to it. Do some people who have high scores default? It happens. But if you look at it over time, over the population. We get it right more often than we get it wrong.The Minister of Finance recently argued that Nigeria’s rising public debt is largely a consequence of currency devaluation rather than new borrowing by the current administration. What is your assessment of that position?Does devaluation of currency make sense? Yes, it does. It does make sense because if you take the current exchange rate and apply it, if you go back five years and you take that exchange rate and apply it, you get a different number. So, is that part of it? I am sure it is. Now, is that all it is? Probably not. The good thing is the vast majority of our borrowing has been internal. So, it has been naira-based. You do not have to worry too much. Not that you do not have to worry about it, but at least it is serviceable. So, let us look at it this way. If they were going to borrow to buy this laptop three years ago, it would be X. If they try to buy this laptop today and they borrow money to do it, it would be five times that amount. So, as I said, what he said is true, but as with the finances of anybody’s house, the finances of the country are nuanced. So, making a proclamation, this is why it happened. No. It is probably not true. You have to look at the entire process. Well, if you say that is why it happened, and the question is, why did you not increase taxes here? So, there are so many levels. So, I personally tend not to listen to those things. Nine times out of ten, if I want to understand nuanced positions, I look for people that are speaking not from a political podium, but more from an academic podium because academics tend to just talk. They have nothing to lose. They have no agenda.Do you believe the naira has reached its fair market value?Given the level of growth that we are seeing in the country, I think long term if the growth levels do not get better, the naira is going to continue to depreciate. But given that now it is free floating, I think the pace of the depreciation would be quite low. And we will see spikes up as we go along the way. So, if you look at recent history when we had a managed process, the problem with the managed process is like you take a balloon, fill it with air, and you start squeezing it on one side. After you squeeze it, it will get to a point where it will just explode. That is those crazy devaluations we used to see. We are not going to see them going forward. I think until the level of growth increases, we are going to see general depreciation going forward.What is your outlook for the economy in the second half of the year?I think it will be no different from the first part. The only thing that concerns me is that everything that is going on in the Middle East is not getting better; it is getting worse. And if it continues to get worse, the price of energy will go up. And if the price of energy goes up, that is just going to flow into everything. So, inflation might get a little higher. So, but aside from that, I do not see anything. Everybody is looking forward to election spending, but the election spending is just going to help increase inflation. So, if there is one thing I expect for the next half year is probably a little bit of a tick-up in inflation. That is about it. So, credit bureaus are like the post office. So, every institution has a box. And inside that box, there are individuals in it. So, anytime the person does a transaction, you take it and put it in that box. And Nigeria’s credit bureau has become negative only. Which is, no matter what you do when you are paying, they do not bother; they do not bother going to put your name in the credit bureau. The day you do not pay, they are going to put your name in the credit bureau as a bad lender. So, what they do is mechanical. They are just collating data. Some of them are just selling scores, but the predictive value is pretty low. What we do is the predictive value side. We do not run around. That is not what we do. What we do is we work with institutions to take all the data that they currently have and give them an output that has real predictive value on how each particular borrower they take out of this pool works. How each particular person is most likely to behave. And again, there is no magic to it. Do some people who have high scores default? It happens. But if you look at it over time, over the population. We get it right more often than we get it wrong.The Minister of Finance recently argued that Nigeria’s rising public debt is largely a consequence of currency devaluation rather than new borrowing by the current administration. What is your assessment of that position?Does devaluation of currency make sense? Yes, it does. It does make sense because if you take the current exchange rate and apply it, if you go back five years and you take that exchange rate and apply it, you get a different number. So, is that part of it? I am sure it is. Now, is that all it is? Probably not. The good thing is the vast majority of our borrowing has been internal. So, it has been naira-based. You do not have to worry too much. Not that you do not have to worry about it, but at least it is serviceable. So, let us look at it this way. If they were going to borrow to buy this laptop three years ago, it would be X. If they try to buy this laptop today and they borrow money to do it, it would be five times that amount. So, as I said, what he said is true, but as with the finances of anybody’s house, the finances of the country are nuanced. So, making a proclamation, this is why it happened. No. It is probably not true. You have to look at the entire process. Well, if you say that is why it happened, and the question is, why did you not increase taxes here? So, there are so many levels. So, I personally tend not to listen to those things. Nine times out of ten, if I want to understand nuanced positions, I look for people that are speaking not from a political podium, but more from an academic podium because academics tend to just talk. They have nothing to lose. They have no agenda.Do you believe the naira has reached its fair market value?Given the level of growth that we are seeing in the country, I think long term if the growth levels do not get better, the naira is going to continue to depreciate. But given that now it is free floating, I think the pace of the depreciation would be quite low. And we will see spikes up as we go along the way. So, if you look at recent history when we had a managed process, the problem with the managed process is like you take a balloon, fill it with air, and you start squeezing it on one side. After you squeeze it, it will get to a point where it will just explode. That is those crazy devaluations we used to see. We are not going to see them going forward. I think until the level of growth increases, we are going to see general depreciation going forward.What is your outlook for the economy in the second half of the year?I think it will be no different from the first part. The only thing that concerns me is that everything that is going on in the Middle East is not getting better; it is getting worse. And if it continues to get worse, the price of energy will go up. And if the price of energy goes up, that is just going to flow into everything. So, inflation might get a little higher. So, but aside from that, I do not see anything. Everybody is looking forward to election spending, but the election spending is just going to help increase inflation. So, if there is one thing I expect for the next half year is probably a little bit of a tick-up in inflation. That is about it. The Minister of Finance recently argued that Nigeria’s rising public debt is largely a consequence of currency devaluation rather than new borrowing by the current administration. What is your assessment of that position?Does devaluation of currency make sense? Yes, it does. It does make sense because if you take the current exchange rate and apply it, if you go back five years and you take that exchange rate and apply it, you get a different number. So, is that part of it? I am sure it is. Now, is that all it is? Probably not. The good thing is the vast majority of our borrowing has been internal. So, it has been naira-based. You do not have to worry too much. Not that you do not have to worry about it, but at least it is serviceable. So, let us look at it this way. If they were going to borrow to buy this laptop three years ago, it would be X. If they try to buy this laptop today and they borrow money to do it, it would be five times that amount. So, as I said, what he said is true, but as with the finances of anybody’s house, the finances of the country are nuanced. So, making a proclamation, this is why it happened. No. It is probably not true. You have to look at the entire process. Well, if you say that is why it happened, and the question is, why did you not increase taxes here? So, there are so many levels. So, I personally tend not to listen to those things. Nine times out of ten, if I want to understand nuanced positions, I look for people that are speaking not from a political podium, but more from an academic podium because academics tend to just talk. They have nothing to lose. They have no agenda.Do you believe the naira has reached its fair market value?Given the level of growth that we are seeing in the country, I think long term if the growth levels do not get better, the naira is going to continue to depreciate. But given that now it is free floating, I think the pace of the depreciation would be quite low. And we will see spikes up as we go along the way. So, if you look at recent history when we had a managed process, the problem with the managed process is like you take a balloon, fill it with air, and you start squeezing it on one side. After you squeeze it, it will get to a point where it will just explode. That is those crazy devaluations we used to see. We are not going to see them going forward. I think until the level of growth increases, we are going to see general depreciation going forward.What is your outlook for the economy in the second half of the year?I think it will be no different from the first part. The only thing that concerns me is that everything that is going on in the Middle East is not getting better; it is getting worse. And if it continues to get worse, the price of energy will go up. And if the price of energy goes up, that is just going to flow into everything. So, inflation might get a little higher. So, but aside from that, I do not see anything. Everybody is looking forward to election spending, but the election spending is just going to help increase inflation. So, if there is one thing I expect for the next half year is probably a little bit of a tick-up in inflation. That is about it. Does devaluation of currency make sense? Yes, it does. It does make sense because if you take the current exchange rate and apply it, if you go back five years and you take that exchange rate and apply it, you get a different number. So, is that part of it? I am sure it is. Now, is that all it is? Probably not. The good thing is the vast majority of our borrowing has been internal. So, it has been naira-based. You do not have to worry too much. Not that you do not have to worry about it, but at least it is serviceable. So, let us look at it this way. If they were going to borrow to buy this laptop three years ago, it would be X. If they try to buy this laptop today and they borrow money to do it, it would be five times that amount. So, as I said, what he said is true, but as with the finances of anybody’s house, the finances of the country are nuanced. So, making a proclamation, this is why it happened. No. It is probably not true. You have to look at the entire process. Well, if you say that is why it happened, and the question is, why did you not increase taxes here? So, there are so many levels. So, I personally tend not to listen to those things. Nine times out of ten, if I want to understand nuanced positions, I look for people that are speaking not from a political podium, but more from an academic podium because academics tend to just talk. They have nothing to lose. They have no agenda.Do you believe the naira has reached its fair market value?Given the level of growth that we are seeing in the country, I think long term if the growth levels do not get better, the naira is going to continue to depreciate. But given that now it is free floating, I think the pace of the depreciation would be quite low. And we will see spikes up as we go along the way. So, if you look at recent history when we had a managed process, the problem with the managed process is like you take a balloon, fill it with air, and you start squeezing it on one side. After you squeeze it, it will get to a point where it will just explode. That is those crazy devaluations we used to see. We are not going to see them going forward. I think until the level of growth increases, we are going to see general depreciation going forward.What is your outlook for the economy in the second half of the year?I think it will be no different from the first part. The only thing that concerns me is that everything that is going on in the Middle East is not getting better; it is getting worse. And if it continues to get worse, the price of energy will go up. And if the price of energy goes up, that is just going to flow into everything. So, inflation might get a little higher. So, but aside from that, I do not see anything. Everybody is looking forward to election spending, but the election spending is just going to help increase inflation. So, if there is one thing I expect for the next half year is probably a little bit of a tick-up in inflation. That is about it. Do you believe the naira has reached its fair market value?Given the level of growth that we are seeing in the country, I think long term if the growth levels do not get better, the naira is going to continue to depreciate. But given that now it is free floating, I think the pace of the depreciation would be quite low. And we will see spikes up as we go along the way. So, if you look at recent history when we had a managed process, the problem with the managed process is like you take a balloon, fill it with air, and you start squeezing it on one side. After you squeeze it, it will get to a point where it will just explode. That is those crazy devaluations we used to see. We are not going to see them going forward. I think until the level of growth increases, we are going to see general depreciation going forward.What is your outlook for the economy in the second half of the year?I think it will be no different from the first part. The only thing that concerns me is that everything that is going on in the Middle East is not getting better; it is getting worse. And if it continues to get worse, the price of energy will go up. And if the price of energy goes up, that is just going to flow into everything. So, inflation might get a little higher. So, but aside from that, I do not see anything. Everybody is looking forward to election spending, but the election spending is just going to help increase inflation. So, if there is one thing I expect for the next half year is probably a little bit of a tick-up in inflation. That is about it. Given the level of growth that we are seeing in the country, I think long term if the growth levels do not get better, the naira is going to continue to depreciate. But given that now it is free floating, I think the pace of the depreciation would be quite low. And we will see spikes up as we go along the way. So, if you look at recent history when we had a managed process, the problem with the managed process is like you take a balloon, fill it with air, and you start squeezing it on one side. After you squeeze it, it will get to a point where it will just explode. That is those crazy devaluations we used to see. We are not going to see them going forward. I think until the level of growth increases, we are going to see general depreciation going forward.What is your outlook for the economy in the second half of the year?I think it will be no different from the first part. The only thing that concerns me is that everything that is going on in the Middle East is not getting better; it is getting worse. And if it continues to get worse, the price of energy will go up. And if the price of energy goes up, that is just going to flow into everything. So, inflation might get a little higher. So, but aside from that, I do not see anything. Everybody is looking forward to election spending, but the election spending is just going to help increase inflation. So, if there is one thing I expect for the next half year is probably a little bit of a tick-up in inflation. That is about it. What is your outlook for the economy in the second half of the year?I think it will be no different from the first part. The only thing that concerns me is that everything that is going on in the Middle East is not getting better; it is getting worse. And if it continues to get worse, the price of energy will go up. And if the price of energy goes up, that is just going to flow into everything. So, inflation might get a little higher. So, but aside from that, I do not see anything. Everybody is looking forward to election spending, but the election spending is just going to help increase inflation. So, if there is one thing I expect for the next half year is probably a little bit of a tick-up in inflation. That is about it. I think it will be no different from the first part. The only thing that concerns me is that everything that is going on in the Middle East is not getting better; it is getting worse. And if it continues to get worse, the price of energy will go up. And if the price of energy goes up, that is just going to flow into everything. So, inflation might get a little higher. So, but aside from that, I do not see anything. Everybody is looking forward to election spending, but the election spending is just going to help increase inflation. So, if there is one thing I expect for the next half year is probably a little bit of a tick-up in inflation. That is about it.