With Oriente, Skype’s co-founder wants to build financial identities for the unbanked

Filipinos shopping at a public market / Photo credit: Flickr

“The telephony market is characterized both by what we think is rip-off pricing and a reliance on heavily centralized infrastructure. We just couldn’t resist the opportunity to help shake this up a bit.”

When Janus Friis, one of the co-founders of Skype, said this to News.com in 2003, he probably had no idea that they would disrupt that sector by more than “a bit.” Eight years later, the platform would go on to be acquired by Microsoft for a whopping US$8.5 billion.

Today, another Skype co-founder is looking to take on a massive problem in Southeast Asia’s developing nations: lack of financial access.

Geoffrey Prentice’s 20 years of experience in the tech industry – first as an entrepreneur, then as an investor – has made him far less coy about the opportunity ahead for his new company, Oriente.

Prentice recalls what he told his Oriente co-founders, Hubert Tai and Lawrence Chu, to convince them to join him. “There’s a problem here that needs to be solved – even bigger than that at Lufax, so let’s go and make it happen,” he said.

Tai established and served as chief technology officer of Lufax, one of China’s biggest online wealth management platforms. The Shanghai-headquartered company is reportedly valued at US$40 billion, thanks to its recent plans to raise US$2 billion in funding.

A highly localized, responsible approach

Oriente’s mission is to allow the unbanked and underbanked communities in Southeast Asia – specifically, the Philippines, Indonesia, and Vietnam – to tap into financial services. According to a report by professional services firm KPMG, around 438 million people around the region have no access to formal financial services.

In the Philippines, for instance, nearly 90 percent of adults are not covered by a credit bureau, which means that many of them have to resort to informal means – family, friends, or other informal lenders – to borrow money.

Oriente plans to accomplish its mission via a suite of financial services tailored for each market. At this point, the startup is using its balance sheet as well as funds raised from investors and partners to fund the loan books of its local entities.

“These local entities have the necessary registration and licenses that allow us to lend in those markets in compliance with existing regulations,” Prentice clarifies.

In May, it rolled out its first product: a mobile app called Cashalo, which provides locals in the Philippines with on-demand access to loans. By August, Cashalo started Cashacart, an online-to-offline consumer product that enables consumers to access a digital credit line for their shopping items like electronics and appliances across a network of 250 retail stores.

Already, Cashalo is seeing rapid growth, going from 1,000 to 30,000 loans as of September.

Prentice claims that this figure could have been a lot higher. Oriente, however, is taking a “more conservative approach,” gathering as much information about potential borrowers as possible to ensure that every loan it extends is well-deserved.

Using data to find and help deserving borrowers

Playing nice with competitors and the authorities

A new Holy Grail