In Uganda, where small and medium enterprises (SMEs) form the backbone of the economy, access to working capital remains a persistent challenge. Equity Bank Uganda has tackled this issue head-on with EazzyStockFinancing, a groundbreaking collateral-free digital lending product launched in 2022.
Designed for banking and mobile money agents, distributors, and retailers, EazzyStockFinancing provides loans of up to UGX 3 billion (approximately $800,000) through a seamless, technology-driven platform accessible via the *247# USSD code. By leveraging digital innovation, Equity Bank is empowering entrepreneurs, particularly in underserved areas, to scale their businesses and drive economic growth.
The Need for EazzyStockFinancing
SMEs contribute over 70% of Uganda’s GDP and employ more than 80% of the workforce, yet many struggle to secure financing due to stringent collateral requirements and lengthy loan approval processes. Traditional banks often demand physical assets like land or property, which many small business owners, especially in rural areas, lack.
Mobile money agents and retailers, who handle significant cash flows but lack formal credit histories, are particularly disadvantaged. Equity Bank identified this gap and introduced EazzyStockFinancing to provide quick, accessible, and collateral-free loans, revolutionizing SME financing in Uganda.
EazzyStockFinancing is part of Equity Bank’s broader mission to promote financial inclusion, aligning with initiatives like the Young Africa Works strategy with the Mastercard Foundation, which aims to empower 4.3 million young Ugandans by 2030. By 2023, the product had facilitated a daily return of UGX 10 billion, underscoring its transformative impact on Uganda’s business ecosystem.
How EazzyStockFinancing Works
EazzyStockFinancing is accessible through Equity Bank’s Eazzy 247 platform, primarily via the *247# USSD code, making it available to both smartphone and feature phone users. To apply, eligible customers—agents, distributors, or retailers with an Equity Bank account—dial *247#, select the loan option, and provide basic business details.
The platform uses digital credit scoring, powered by machine learning algorithms, to assess eligibility based on transaction history, cash flow patterns, and account activity rather than traditional collateral. This data-driven approach reduces approval times to mere minutes, a stark contrast to the weeks-long processes of conventional banking.
Loans range from small amounts for micro-agents to UGX 3 billion for larger distributors, with flexible repayment terms tailored to business cycles. Interest rates are competitive, typically ranging from 1.5% to 2.5% per month, and repayments can be made via mobile banking or agency outlets. The platform also offers real-time loan tracking, enabling borrowers to monitor balances and repayment schedules through the Eazzy 247 app or USSD.
The Technology Powering EazzyStockFinancing
At its core, EazzyStockFinancing leverages Equity Bank’s robust digital infrastructure, built on cloud-based systems and secure APIs. The platform integrates with the bank’s core banking system to pull real-time transaction data, enabling instant credit assessments.
Machine learning models analyze patterns in mobile money transactions, point-of-sale (POS) activity, and account inflows to predict repayment capacity, minimizing default risks. End-to-end encryption ensures data security, protecting users from cyber threats—a critical feature in a country where digital fraud is a growing concern.
The USSD interface (*247#) is a game-changer for inclusivity, as it allows feature phone users in rural areas with limited internet access to apply for loans. This aligns with Uganda’s mobile penetration rate of over 70%, ensuring broad reach. The platform’s scalability is evident in its ability to handle thousands of applications daily, with automated processes reducing operational costs for the bank.
