The research by Oakam found that customers from Sierra Leone have a 96 per cent repayment level, those from the Congo have 92 per cent, while Nigerian nationals on average secured a 90 per cent level – all above the store average.
Despite these positive statistics, those who have recently moved to the UK from places within Africa and who do not have a bank account in the country, often fail to meet the strict lending criteria laid out by the mainstream banking sector, resulting in their financial exclusion.
With little or no access to banks, many also face higher charges for cheque cashing and utility bills, making the financial strain even harder.
Congolese born, CEO of Oakam Frederic Nze comments, “Access to credit is a real problem for so many people but it an essential part of how we cover unexpected expenses in the UK. Many household purchases are beyond what people can afford in one go, cars, washing machines, back-to-school kit and other irregular purchases can be simply impossible to obtain without the help of a loan or credit card. It is especially hard for those on low incomes and those who have recently moved to the UK. “
Banks argue that those with low or absent credit histories are too much of a risk – but these findings by Oakam show that when it comes to repayment, those who have recently arrived in the UK from Africa are in fact very trustworthy.
Frederic continues “At Oakam we take time to look at the person and not just the credit score. We also make sure that our customers’ repayments are logged with credit reference agencies – helping them to build their credit history for the future.
“The problem is that people cannot build a credit history unless someone lends to them and no-one will lend to someone unless they have a credit history. This chicken and egg cycle is broken by us, but other lenders now need to follow our lead.”
Oakam’s staff speak over 27 different languages collectively, allowing customers from almost any country (at present Oakam have customers from around 126 different countries) to understand the financial services offered in their own language.