Quote from Ndubuisi Ekekwe on May 31, 2018, 6:58 PM

Piggybank.ng has raised $1.1 million from local and international investors including LeadPath Nigeria, Village Capital and Ventures Platform. The startup brought innovation on saving by adding one minor layer: they allow you to save, you decide your withdrawal dates, and they impose a fine if you deviate from those days. As I wrote about this firm in the past,  they used the psychology of using fees and fixed dates to help savers reach their goals. And the thing works.

Piggybank is not your typical savings account. There is a clear innovation in what the team is doing. In a place like U.S, one can patent the business model because they are using the constructs of fees and dates to shape customer behaviors to save. It is an uncommon business model if you look at what the industry does. It pays you no interest, for saving, but could penalize you for using its platform, and failing to meet your saving goals! That specific condition removes any temptation you may have to withdraw money prematurely, making it possible for you to meet your saving goals. When that happens, the platform has offered you value, and solved a friction in the market (poor saving habits). The psychology of using fees and fixed dates to help savers reach goals is the fascinating ingenious algorithm the young people have engineered in Piggybank Nigeria.

In a press release Piggybank notes that “Today’s announcement allows us to expand and capitalise on the many opportunities that the market presents us with. With this fundraiser, we can invest significantly in our people and products, as we build a digital financial warehouse accessible to millions of Africans whose savings woes we want to put firmly behind them.”

Besides, the company has a microfinance license which means it does not need to depend on any bank going forward.