Ghana

Blog | iDE Ghana increases access to sanitation with help of innovative credit assessment from LenddoEFL

Partnership allows Ghanaians to purchase their first toilets

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Globally, 32% of people lack access to a toilet in their homes (Source: WHO UNICEF JMP). In Ghana an astonishing 87% of people do not own a toilet. And in rural Northern Ghana, it is worse still. Two out of every five children in northern Ghana are stunted, compared to approximately 20% of children stunned nationally (Source: UNICEF).

iDE Ghana, a nonprofit that creates income and livelihood opportunities for poor rural households, wanted to improve sanitation in the region. They began by applying design thinking to understand the low rate of toilet use. It turned out that people didn’t know where to buy a toilet, and if they did, it was prohibitively expensive to buy.  People could not afford the full cost all at once, and there were no options to pay for a toilet over time, as there were for other large purchases.

"What we found was the criteria for borrowing towards non-income generating loans were ridiculous. So we set up a one stop shop for toilets and sanitation products, selling them door to door,” explained Valerie Labi, WASH Director at iDE Ghana. “And the beauty of the model is that we give our customers 6 to 18 months to pay the toilet off over time.”

This seemed like the perfect solution given the challenges to toilet purchasing uncovered, but it was still challenging. “We allowed people to pay over the course of 6 to 18 months but we required for the customer or a guarantor to prove their income with bank statements or payslips. And this was a big deterrent. No one wanted to give their bank statements to a toilet company. And it would take an average of 40 days to get through the process” Labi shared. “We realized these requirements were scaring away customers as they’d never had formal credit before. So we asked ourselves, how else could we assess creditworthiness in a more inclusive way?”

That’s when they came across LenddoEFL universal credit assessment. By collecting behavioral and psychometric data at the time of application, iDE’s commercial agents will be able to assess risk and make a decision in a day or less, cutting down the time to sale greatly. Previously, the commercial agent made multiple calls and visits to collect the required documents. By using the LenddoEFL score, iDE removes the need for a guarantor or proof of income for the best scoring customers. Low scorers will need to pay 50% of the cost of the toilet in monthly installments before receiving the toilets.

iDE’s goal is to provide 20,000 to 25,000 toilets to households in Northern Ghana. At an average of 11 people per household, this will provide life-saving sanitation for 275,000 people. And the plan is to sell toilets as part of a fast, convenient customer-driven process and at affordable rates. With the LenddoEFL assessment in place since February 2018, iDE is already receiving positive feedback for customers who enjoy the process. Stay tuned for updates on this exciting partnership.