How Fundary Is Testing The Market
A fiat version of Fundary’s peer to peer lending platform has been fully functional in Mexico for several months now, but due to unforeseen costs associated with credit scoring, we decided to go back to the drawing board and explore the world of cryptocurrencies and smart contracts. During this process we went through a long ideation phase, and the whitepaper that is now public was conceived.
The founders of Fundary are long-term businessmen that have both built 8 figure businesses from scratch which is why unlike most whitepapers, ours has a strong focus on the business end.
The whitepaper describes the Small Business Ambassador Program — a unique approach to solving the loan origination problem that exists in developing countries. The underbanked are not actively looking for loans, because they have never really had the option to receive them.
The one area that is seeing staggering growth in Mexico is in product financing; the largest retailer to issue product financing for its products gave out over 4 million loans in the last year.
One of Fundary’s short term goals is to provide product financing, at a fair rate, to the underbanked customers of all small businesses in Mexico. To test the viability of the Small Business Ambassador Program, we have been actively developing the technology and bringing small businesses onboard. We expect to have the Ambassador Program live and issuing loans in 5 cities in Mexico by the end of February.
In these coming weeks, Fundary will also be announcing several key Ambassador partnerships in Mexico. Partnerships that we hope will bring thousands of small businesses onboard.
How does this work?
Describing how this works is best done through an example:
- Marisa, an owner of a small local veterinary clinic signs up to Fundary as a Small Business Ambassador.
- Rosa, a Mexican maid who has never had a bank account, brings her sick dog to Marisa’s clinic. The bill is more than Rosa can pay right now, but since Marisa knows and trusts Rosa, she offers to sign her up to Fundary.
- Marisa stakes Rosa with a collateral equal to a percentage of the loan, and a Fundary loan request is made on the platform.
- Hans, a German Fundary investor, sees Marisa’s history as an Ambassador, and decides to make the loan.
In the event that Rosa pays the loan on-time and in-full, Marisa’s collateralized amount is cleared. In the event that Rosa does not, Marisa’s collateralized amount will be transferred to Hans.
For our current testing period:
- Fundary and its Ambassadors will operate exclusively in Mexico
- Loans and their collateral will be issued in Mexican pesos
- Loans will be entirely microloans (under $200 USD)
- Fundary itself will be the sole lender.
By mid-2018 we aim to introduce peer to peer domestic lenders to the system for 1:1 loans, and allow for loans up to $1000.
In our long-term goal vision:
- Fundary and its Ambassadors will operate in dozens of countries
- Loans and collateral will be in cryptocurrency
- Lenders will be from anywhere in the world.
- Loans will be materially larger, collateralized by multiple Ambassadors, and financed by multiple lenders.
I hope this helps explain our concept and gives transparency on our goals and where we are in the business. We believe in validating the business end of the concept with our own money before even considering financing.
We welcome any and all comments and questions, if you haven’t already, you can speak with us in the Telegram group.