Alternative Data and SME Financing Center stage at G20/GPFI Forum in Berlin
I want to thank @Johnowens for a great presentation of the SME Finance Forum's research on this topic, and to our great panelists @anjupatwardhan from @creditease/@stanfordu, Thorsten Seeger from @fundingcircle, @joyceokello from @bankofuganda, @hannagrant of the @accesstoinsuranceinitiative, and @volkerhey of the Federal Ministry for Economic Development and Cooperation (BMZ) for creating a most lively discussion on the issues arising from the explosion new data sources and users out there.
The panel made clear that we are in an era where the supply of both traditional financial transactions data and new types of data probably relevant to financial capability (ability and willingness to repay, in particular) is increasingly exponentially. At the same time, a host of new institutions are using this data to take part in financing, alongside the traditional banks and non-bank finance companies.
And much of this data is available with the legal consent of the data owner (the entrepreneur), but perhaps without full awareness of how much data we've made available through a few quick clicks of consent documents on-line. What to do about this? How to balance support for innovation with customer protection? well, that's going to be a priority for the G20 as it moves forward on turning the High Level Principles for Digital Financial Inclusion into country-level actions.