A Nigerian fintech company has created a platform that securely makes saving possible by combining discipline and flexibility.
Many people have good intentions to put money aside for savings, but find it difficult to achieve their goals on a day-to-day basis. This is especially true in countries like Nigeria, where many people do not have access to credit, and where most payments are made in cash. A Nigerian fintech start-up has now developed a plan to help these people grow their savings. The company, Piggybank, has developed an online platform that forces people to save.
Savers using Piggybank chose an amount to deposit each day into their online account, and set a withdrawal date. They cannot withdraw their savings until the agreed-on date without facing an early withdrawal fee of 5 percent. In return for meeting their goal, savers earn 6 percent per annum interest (or 10.95 percent on a fixed deposit) on their savings. The founders hope that the site will help create a culture of saving in Nigeria. They report that the site is especially popular with the country’s Millennials, who are already familiar with using their mobile phones for most day-to-day transactions. Piggybank has been in operation for two years, and has recently raised 1.1 million USD from a group of Nigerian investors. To date, users of the site have saved more than 5 million USD. The company claims that most of its growth has come from peer-to-peer recommendations. They also have a unique referral program called Piggybank Stories, which rewards savers for sharing their story with others.
Springwise has recently covered a large number of fintech innovations designed to help people spend their money in new ways. These include a mobile wallet and an app that sets up scheduled payments for almost anything. This is one of the first fintech innovations that encourages people to save in new ways. Piggybank is currently available only in Nigeria. Can the Piggybank platform be successfully replicated in other countries?