Loan Lab
Designing a mobile app to increase financial loan access in developing countries.
Role
Product Designer
Duration
Apr ’22 – Aug ’22
This work is NDA-Protected. Please contact me if you'd like to learn more.
According to the World Bank, nearly 2 million people are excluded from the formal financial system, preventing access to services such as savings and credit. The opportunity to use these types of financial services could help build self-sufficiency and economic stability for many. In developing countries, wage-paying jobs are limited, often leading to employment through unregulated markets. Many individuals are self-employed, owning and operating small businesses. Credit traditionally requires meeting a stringent set of financial prerequisites, placing borrowing out of the hands of millions who could benefit from it.
I conducted secondary user research in order to gain a better understanding of what the loan application process looks like for someone with poor or no credit, or even no bank account.
For individuals in the developing world, attempting to gain access to credit can feel like running through a maze only to consistently reach dead ends. Loan approvals are a moving target with a number of obstacles in the way for those who may not own valid IDs or hold a credit history. The World Bank explains how “weak legal and institutional frameworks for lending and debt resolution – combined with the lack of predictability for lenders, the inability to leverage productive assets, and the absence of credit information – creates a lending environment that is unfavorable to Micro, Small and Medium Enterprises (MSMEs) and individuals".
The problem could be tackled from a few different angles, however, a mobile app providing peer-to-peer loans seems to be the most accessible option that directly addresses the lack of funding. As access to cell phones and cellular data plans is increasingly common in developing nations, this would be the best tool to reach entrepreneurs with. With transactions secured by blockchain, the need for third-party verification could be removed and users could send and receive money through the application. Entrepreneurs could post their loan requests and stories and other app users could lend them money directly through the application, together deciding upon interest rates and payment frequency.
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User Journey
I created the user journey below to help highlight how the solution might function and areas of focus that may need to be implemented.
Competitive Analysis
After searching for existing companies, I found that Kiva is the only established company with a similar business model.
While Kiva is quite successful with a well-structured website, the company does not use blockchain technology and thus still rely on third-parties to conduct business. They do not use a mobile application either, which may limit their reach.
Usability Tests
Watching users interact with the low-fidelity prototype helped to highlight points of confusion and weaknesses in the designs. Interesting insights regarding users’ interactions with the wireframes were noted down and the wireframes were iterated on accordingly. These themes included:
- 4 out of 5 participants had trouble
understanding how to select “lend” or “borrow” - 4 out of 5 participants had further
questions when selecting someone to lend money to - 3 out of 5 participants had further
questions about the funding process
Development
Digital Wireframes
In my initial research, I encountered many complaints that included impersonal interfaces with too many menu items. Given this, I attempted to keep the app personal and clear.
View the full wireframes here.
Usability Tests
Watching users interact with the low-fidelity prototype helped to highlight points of confusion and weaknesses in the designs. Interesting insights regarding users’ interactions with the wireframes were noted down and the wireframes were iterated on accordingly. These themes included:
- 4 out of 5 participants had trouble
understanding how to select “lend” or “borrow” - 4 out of 5 participants had further
questions when selecting someone to lend money to - 3 out of 5 participants had further
questions about the funding process
Delivery
Visit the high-fidelity mockups here.
Next Steps
Once the app has gathered a user base further testing should be conducted in order to validate its effect on the problem. This research should include qualitative data, collected from entrepreneurs receiving the loans, and quantitative data regarding their economic stability.
Takeaways
Love the problem, not the solution. Throughout the research phase of the project, I immediately jumped to what I know – make a website! It took some conscious reflection to slow down and consider the specifics of the problem and larger solution use cases. Once I took the time to focus on the users rather than my own ideas, the concept of a mobile application clearly stood out.
