Affordable financing is one of the largest barriers to inclusive trade. 65 million microentrepreneurs in emerging markets have solutions to local needs and willing customers. They just lack capital, as indicated by their US$2 trillion credit gap.
The need to invest in grassroots economies is increasingly urgent, but there’s no solution to democratize the process. Impact sector funding, such as official development assistance and impact investing, totalled US$550 billion last year. Yet, nobody knows how much of this financing directly reached the hands of grassroots individuals because tracing funds is expensive and complicated.
Using digital tokens, Aeloi has built a system for automatic fund tracking, including funding from foundations, development partners, or private sector. Digital tokens are a flexible form of pre-paid shop credit or vouchers only usable at approved vendors. Our platform doesn’t require smart phones or mobile data, making our technology as inclusive as possible.
Aeloi aims to become the premier marketplace to invest in microentrepreneurs by providing an assured digital link from source to end. Investments are locked in to the system, making sure all funding is for assets critical for small businesses. Our pilots have shown that there is a strong value proposition for all stakeholders. Impact investors gain impact and returns. Microfinance institutions can track loans easier. Borrowers access more affordable finance and financial discipline.
Aeloi’s target clients are informal sector microentrepreneurs who do not have any collateral or credit history, so they borrow at high interest rates. We can help them access tailored loan products, increase business income, and automated personalized services, such as business skills support.
With detailed digital footprints, we use data and behavioural insights to grow economies of scale, such as coordinating advocacy, negotiating vendor discounts, or building alternative credit scores. Our big data platform is flexible to power wide-ranging products such as insurance or skills training in education, health, transportation, or agriculture.
Aeloi was born from 20 years of frustrations with development work in Africa and Asia. We especially disliked 2 aspects: the “beneficiary” power dynamic where donors had the most power and tracking impact required a lot of money and time. Aeloi is our attempt to put grassroots users at the centre of economic development.