Bringing the world’s unbanked on the path to financial security
EHF Fellow Mikko Perez is giving people in emerging markets access to financial services that can significantly improve their lives.
There will be over 1.6 billion people entering the middle class by 2030, most of them in the fast-growing emerging economies in Asia. The emerging middle class in Asia is expected to power the world’s economy in the next three decades.
Asia’s middle class are enjoying increasing incomes but remain unbanked and have limited access to financial services, such as cash remittances, loans, insurances, savings, and investments). Most still prefer to transact in cash in spite of the introduction of digital and mobile payment alternatives.
Miguel “Mikko” Perez knows this problem all too well. Miguel is an EHF Fellow from Cohort 5 who grew up in the Philippines and as a community organizer at the beginning of his career, saw firsthand the problems of the unbanked in poor rural communities. After working in Silicon Valley, he decided to combine his experience in finance, technology, and working with communities to start Ayannah, a fintech startup that enables affordable and accessible digital financial services for the emerging middle class in Asia.
Sending Cash a Costly Problem for the World’s Unbanked
Many of Asia’s middle class have migrated to cities or to wealthier countries looking for jobs and livelihood opportunities and send large amounts of money back to their families in rural areas. Because the majority of these people are “unbanked” they must send cash through a process that is often costly and inconvenient. Transferring cash requires steep fees — up to 12% of the amount being sent — and many times the cash is delayed or misdirected causing a headache for the people trying to receive it.
The “Uber for Financial Services”
Ayannah started out by building the largest inter-operable agent-based transaction network in the Philippines to move cash cheaply and conveniently from overseas and from the cities to the countryside. “Think of it as Uber for Financial Services - anyone can be a teller or cashier,” says Mikko.
Ayannah’s transaction volume has grown steadily over the past three years and growth has been accelerated by the COVID-19 pandemic as people have rapidly shifted to “contactless” digital transactions due to infection fears. Ayannah’s transaction volume for the first six months of 2020 is more than double that of its transaction volume for the entire 2019.
Better Data to Create Financial Services for Asia’s Emerging Middle Class
As more and more people use Ayannah’s apps to perform digital financial transactions, Ayannah is collecting a treasure trove of data to understand its customers’ behavior and financial condition which Ayannah is now using to help banks, lenders, and insurers build products and services that serve the needs and aspirations of this large and young population of the emerging middle class.
For example, millions of Filipinos have little or no health insurance coverage. Ayannah recently launched a hospital income benefit product in partnership with a global insurer, AXA, that provides a daily income for people who are confined in a hospital for whatever reason. This product has become even more relevant due to the COVID-19 pandemic as many people face expensive hospital confinement if they fall sick due to the virus.
Ayannah also recently partnered with the largest microfinance institution in the Philippines serving close to 7 million members and insuring 20 million Filipinos to digitize loan and insurance applications and to provide disbursement and collection services through Ayannah’s large and growing agent network.
Launching Ayannah in Indonesia
Ayannah is also launching digital services in Indonesia very soon to help banks, lenders, and insurers reach millions of people in the rural communities scattered in the thousands of islands of Indonesia’s archipelago.
Ayannah already serves millions of people and has plans to expand to other emerging markets in Asia. According to Mikko, “We are just getting started. We aim to build a business that will not only produce superior returns for investors but will make a difference in the lives of hundreds of millions of people in emerging economies around the world.”
Ayannah: “The Good Path” to Financial Security
“Look for big problems to solve. Everything else will fall into place.” The success of any venture, Mikko believes, lies in its dedication to solving very specific problems. In Ayannah’s case, the problem had two sides. The emerging middle class lacked access to financial services that improve their lives. On the other hand, banks, lenders, and insurers had to understand and serve the needs and aspirations of the large and young population that will become Asia’s middle class in the next decade.
Ayannah means “The Good Path” in Sanskrit - Ayannah’s mission is to guide Asia’s emerging middle class on the path to financial security by giving them access to digital financial services that improve their lives
Get Involved
Basic financial services can have a transformative impact on people’s lives. You can learn more about Ayannah and the impact this innovative company is making here: https://www.ayannah.com/
Journey with us
Impact is a journey and it doesn’t happen in a vacuum. It takes a group of inspired, committed, and informed individuals to get a world-changing idea off the ground. You can help amplify EHF Fellow impact as they work to develop solutions to some of humanity’s biggest problems. Here is how you can join us in this work as we journey together on a path to a better world:
Stay informed - Read, learn, watch, and stay up to date on the latest in impact innovation by signing up for our newsletter.
Amplify our impact - Share our impact stories with your networks and connect with our Fellows. Learn more about their projects here.