Meje Tuyo, a Nigerian is set to disrupt high interest Payday lending with Owo, a blockchain based startup that would act as an intermediate for customers who need to build their credit. Owo which means “money” in the West African language of Yoruba is set to debut this fall. Owo is is a technology company offering financial services aimed at helping its users avoid the traditional payday loan industry.
CEO of Owo Meje Tuyo will first be addressing the challenges of African Americans since they have the highest population of workers relying more on payday loans than other groups. Tuyo explains, “The focus is to use blockchain to address some fundamental economic issues for, largely, African Americans…That pain point usually starts with economics, currency and access to capital.”
The company has plans to launch Pazima, an app which will allow its users to make request for loans which will be automatically be repaid when they receive their paychecks. According to Tuyo, loan repayment will be triggered through smart contracts running on the Ethereum platform that will be automatically triggered when certain programmed conditions are met.
However, Interest rates will vary depending on the bank, but will be up to 400 percent lower than the usual payday loan rates. Also, participating banks will be able to determine and program their own underwriting rules that will determine the taking the loan. Tuyo explains, “Their income, payments made to the bank, are recorded in the ledger, and simply by connecting to the blockchain banks can see all that information and make a fair assessment of that individual.” Tuyo has revealed that he is currently in talks with companies such as Walmart to include Owo as part of its employee benefit. Tuyo added, “Payday loan sharks make a ton of money on the backs of people who just don’t have it. Our goal is to disrupt this industry and to deliver economic equity to the people who need it most.”
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