This Startup Can Turn Your Phone into a Credit Report

Want your phone to generate your credit report and get you a loan? Don’t worry, Branch is working on it.

This San Francisco-based startup Branch raised $9.2 million from Andreesen Horowitz. Led by the co-founder of non-profit lender Kiva, Branch uses an algorithm to crawl through contact lists, social network data, GPS data and SMS logs on a phone to generate a credit profile for unbanked consumers.

The startup’s primary market is Kenya and after this funding, Tanzania. Branch controls the entire lending supply chain in Africa, right from assessing a person’s creditworthiness to selling loans to collecting debt.

As new lenders emerge in the market, they create a new breed of borrowers. Startups are spending tons to hire top class talent to create new credit models that are, as some would say fairly accommodating of riskier borrowers.

Last month (February 24th), P2P insurance startup Lemonade hired behavioral economist Dan Ariely to design systems to assess risk. Data Analytics startups like PeerIQ and Dataminr perform similar functions for investors.

As for Branch, focusing on the lending market in Africa might be a good strategy after all.