The conversation around social impact and sustainability in fintech has become increasingly prominent. But are these just trendy buzzwords, or are they really shaping the future of the industry? JUMO’s Customer Intelligence Lead, Faiza Devji shares her personal perspective.

There’s no denying the need for being conscious about social impact and sustainability in business today. We find references to this in mission statements and sales messaging, but is this driving genuine progress, or is it just a marketing ploy?

For powerful positive change we need to go beyond the jargon.

What does social impact and sustainability mean in the context of financial technology?

For JUMO, social impact is about empowering individuals who’ve been excluded from formal financial systems with access to responsible credit and other financial products. Sustainability, on the other hand, means ensuring JUMO’s business practices are building a healthy financial ecosystem for all.

These two concepts are deeply intertwined. Sustainable practices ensure we’re here for the long haul, allowing us to continue our mission of financial inclusion. Social impact, in turn, creates a more stable and prosperous society, creating fertile ground for sustainable business growth.

The net effect of social impact and sustainability working hand in hand extends far beyond JUMO.

Across the finance industry, these values are becoming a driving force, and are pushing fintechs to innovate and develop products that address social needs while remaining financially responsible.

Beyond compliance

Social impact and sustainability can sometimes be seen as regulatory compliance. However, at JUMO, we view them as strategic opportunities. By putting these values at the top of the agenda, we attract top investors, partners and talent while positioning ourselves for long-term success.

Our focus on social impact metrics helps us attract employees who are passionate about working towards making a positive difference. Our impact also appeals to  capital providers and impact funders who share our values and want to expand their reach in sustainable ways.

Challenges and opportunities

Of course, implementing these principles isn’t without its challenges. Measuring the true impact of our actions can be complex. Also, striking a balance between affordability for customers and financial viability for JUMO requires careful planning and innovation.

However, the opportunities are equally abundant. By demonstrating a commitment to social impact and sustainability, JUMO can build stronger relationships with the banking and ecosystem partners we serve. This translates to increased capital available for lending, which means we can serve more customers.

Through these funding partnerships we can offer microloans at scale to small business owners in Africa who need access to working capital to grow their businesses. This not only empowers entrepreneurs but also drives economic growth in their communities and countries.

Sustainable finance offers numerous benefits to customers as well. By providing access to responsible credit products, customers can break the cycle of debt and plan for their long-term financial well-being.

Integrating social impact

In my role, I constantly strive to integrate social impact and sustainability principles into customer intelligence initiatives. This means ensuring our surveys and data analysis take into account not just financial metrics, but also the broader socio-economic impact of our products and services.

For example, we continuously measure the financial burden to repay loans amongst our customers. Our focus is to improve this metric and we are seeing improvements in most of our portfolios. For the few where this sentiment doesn’t improve, we are taking a more in depth look to understand the reasons behind this and understand the changes that can be made to ease the burden on our customers.

The role of policy

Looking ahead, I believe social impact and sustainability will become essential considerations for all businesses. Governments and regulatory bodies can play a guiding role by providing clear frameworks and incentives that encourage responsible practices among fintechs.

For businesses unsure about prioritising social impact and sustainability, I offer this advice: Embrace these values not as burdens, but as opportunities for innovation and long-term success. Conduct thorough research, understand your customers’ needs, and align your mission with the greater good. There’s no better time than now to join the movement towards a more responsible and inclusive financial future.

Connect with Faiza.