A Singapore startup’s software is democratizing lending

Even as the global banking industry takes massive strides toward digitalization and market expansion, millions of people still don’t have access to traditional financial services.

The e-Conomy SEA 2019 report by Google, Temasek, and Bain & Company notes that out of almost 400 million people across Southeast Asia, half are unbanked. Meanwhile, many small- and medium-sized enterprises also face large funding gaps.

This has paved the way for the rise of lending companies. While most of these are startups that serve as middlemen between borrowers and lenders, TurnKey Lender focuses on the software component of loaning. It aims to give smaller lenders – such as payment solution providers, ecommerce merchants, and telecommunications firms – information sources and capabilities similar to what bigger players have.

CEO Dmitry Voronenko / Photo credit: Turnkey Lender

The company currently has 107 employees and over 100 customers all over the region, including ecommerce supply chain startup Zilingo, venture debt firm Innoven Capital, and pawnshop company Cebuana Lhuillier.

Founded in 2013 by Dmitry Voronenko and Elena Ionenko, Singapore-based TurnKey Lender has created a unified lending management (ULM) platform fit for small lenders going into an “extremely fast market [and needing] everything under one umbrella,” says Voronenko, who is also the company’s CEO.

TurnKey Lender claims that its software, which has built-in anti-fraud models and credit scoring systems, can approve loans in under 30 seconds. To do this, it uses neural networks to crunch massive data points, which it acquires from customers’ mobile usage, behavioral data, and financial patterns. And to speed up the processing of loan applications, it also pioneered an optical character recognition library that scans documents like bank statements or government identification.

TurnKey’s application programming interfaces (APIs) connect lenders to their markets’ credit bureaus, traditional banks, and payment processing providers. As of November this year, the company is working with “more than 80 external credit bureaus and payments processing services,” says Voronenko.

In countries where it has yet to expand, TurnKey Lender offers a self-service version of its ULM solution and makes its APIs publicly accessible, enabling local teams to initiate their own integrations. Lenders in these markets can also manually input loan information into its software so “they can start immediately,” according to Voronenko

The CEO describes the company’s clientele as those who are looking to automate at least hundreds of loans per month. Approximately 80% of these customers pay for TurnKey Lender’s main product, with the remainder paying for its modular options: loan origination or loan servicing.

Evaluating the unbanked

One of the most common challenges of approving loans for unbanked citizens is the lack of prior information.

TurnKey Lender overcomes this hurdle in two ways. First, it gathers alternative data from its customers. Instead of asking for credit data from an unbanked farmer, for instance, the company inquires about the size of their tilled land in hectares, the crops they plant and harvest, and even the amount of fertilizer they use per year.

“This can be, more or less, a good prediction of what they will get,” he says. “Sometimes, a lender can say, ‘OK, I will give you money, but just for more fertilizer or only for this and that.’ This breaks the ice because next time, the same lender can give more money without problems.”

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