Tapping into a glaring gap of serving the unbanked market, Bayport Financial Services has grown from a few clients in five years to over 10 000. The company’s executive chairman Father Maphongo maintains the future looks very bright. He spoke to KABELO ADAMSON.
Patriot: What was the idea behind the formation of Bayport Financial services?
Maphongo: We realised that there was a market that was not being catered for by the banking sector and we wanted to serve that market. Bayport provides unsecured loans to customers who are formally employed but do not have access to the full spectrum of banking services.
Patriot: What is the relationship between Bayport Financial Services Botswana and the Bayport Group?
Maphongo: In 2010, Bayport Management Limited (BML) came on board as a shareholder and the trading name changed from Moneyquest Investments to Bayport Financial services. Each BML operation has independent shareholders and boards, however BML as an institutional investor has shares in all the operations within the group and hence represented in all boards. The other shareholders in local operations are citizens which includes me and the co-founder, Segomots Masuku.
Patriot:Who funded the establishment of the Bayport?
Maphongo: I together with Masuku used our own funds to establish Moneyquest Investments.
Patriot: Which products does Bayport offer to its customers?
Maphongo: We offer loan facilities and these are offered to payroll-based employees. What happens is that we sign an agreement with the employer where we would then provide loans to those employees. Our model is payroll-based lending. The loans that we offer are for housing improvement, school fees, wedding and basically anything that can add value to the clients’ lives. In addition, we do offer credit life insurance to protect our clients against unforeseen circumstances in case they have secured a loan and something happens.
Patriot: What other products are you intending to introduce to the market?
Maphongo: As a business obviously we want to grow. We have embarked on a research to try to determine the needs out there of the products. It is that research that will actually inform us of what products are needed by the customers and that is our model for designing the products.
Patriot: How many branches does Bayport currently have nationwide and are there plans to add more?
Maphongo: We are spread throughout the country. We have 14 branches countrywide affecting all the major towns and villages. We have two branches in Gaborone including the head office and others in Francistown, Mahalapye, Palapye, Serowe, Maun, Selibe Phikwe, Ghanzi, Tsabong, Kang, Lobatse, Molepolole and Kanye. With regards to opening new branches, for now we believe we have reached our optimum in terms of coverage. However should opportunities arise, we would look at those to determine the next step. One area we would seriously look at is Kasane.
Patriot: What is Bayport’s market share?
Maphongo: Without necessarily beating our own drums, we are proudly number two in terms of the market share and have moved from a small company to a medium company with a balance sheet in the region of P100 million.
Patriot: What is Bayport’s position with regards to financial wellness in Botswana?
Maphongo: Financial wellness is critical to our business and to the industry and equally important is sharing credit information amongst players to ensure that clients are not over committed and to regulate players against reckless lending. We have embarked on a programme to disseminate information on financial wellness and we have so far run a programme in Gantsi to kick start initiative.
Patriot: Has Bayport achieved its aims since its formation?
Maphongo: You will appreciate that this is a process and not an event; therefore we would not say we have achieved that until we are able to take business to the most remote area in this country - to the unbanked communities.
Patriot: Kindly discuss the biggest successes of Bayport since its establishment.
Maphongo: We have created employment opportunities for 70 people who are employed in all our branches and also created further employment to other 100 people who are engaged as mobile agents. Bayport has also achieved Smart accreditation as well as growing business to the size and level is at now.
Patriot: Explain how the company achieved the Smart accreditation and the significance of the recognition?
Maphongo: Smart is a client protection certification in terms of products. We design the products in accordance with demands of the client; it means we are transparent in our dealings with clients. It actually requires us to disclose the pricing structure of our products. To get the recognition, an independent assessor would visit the institution and inspect the processes and ensure that the processes and policies are in line with the accreditation requirements; where there could be shortfall in terms of procedures you will not get accredited. They ensure that these policies are not only on paper, but are applied as well. We are proud that we are the first institution in Botswana to be accredited and the first payroll lender in Africa to be accredited.
Patriot: How many clients does Bayport service and how has the number grown over the last five years?
Maphongo: We started from zero and are currently have over 10,000 customers. We started from two branches to 14 and five staff members to 70. Our customer base is mainly the civil servants and employees of approved employers.
Patriot: What are some of the challenges that Bayport faces in its daily operations?
Maphongo: The main challenge is customers breaching affordability levels from accessing credit from unregulated lenders and thereby putting their welfare at risk.
Patriot: What sets Bayport apart from the rest of its competitors?
Maphongo: We operate a mobile agency because we believe in delivering services at the convenient of our clients; you do not need to come to our offices to get the services. We deliver the services where you are.
Patriot: What is the company doing in terms of Corporate Social Responsibility?
Maphongo: Amongst the Corporate Social Responsibility programmes that we have undertaken are houses we have built for the under privileged. We have three houses – one in Tlokweng, and others in Palapye and Moshupa. Another is currently being built in Malaka, Tswapong. We have also participated in a number of schools’ end of year awards through sponsorship.
Patriot: What is the long-term vision of Bayport, maybe in the next five years or so?
Maphongo: As a business we continue to explore opportunities that avail themselves. The research findings will guide us on our next move. Our vision is to be the most valued financial services brand in this market by providing a broad range of unique and relevant financial solutions tailored to the needs of our customers. To achieve this, Bayport will be the engineer of a new reality in financial services provision; and will be recognised for consistently demonstrating the highest standard of care, responsibility and innovation.
Patriot: And your last words?
Maphongo: I am actually excited, nobody knew about Bayport five years ago but I am happy to say to you if you were to meet two people, one of them will know about Bayport and that is sign of growth. We have impacted - as per our mandate - positively on people’s lives. We have offered them good credit, which in most cases has been used wisely for the betterment of the applicant’s lives. We are proud to be in that space where we are actually serving those customers that would ordinarily not get service from the banking industry and it is our expectation that we will fulfil our vision in terms of covering the most remote areas of the country where we can deliver the services to the unbanked community. We are for the financial inclusiveness.