Michael Lee-Chin Jr ventured into an online business that offers loans to the unbanked and others who find it difficult to access credit.
Lee-Chin Jr, the son of investor and bank owner Michael Lee-Chin, has teamed up with banking and finance veteran Andrew Patterson and technology and communications professional Adrian Dunkley in a start-up up called Seed Investments.
Since May 2022, the trio have been testing technology that will support a total digital microfinance operation and dealing with regulators.
Lee-Chin Jr, the eldest of three brothers, says he is not involved in his father’s multi-billion dollar financial empire, which includes NCB Financial Group, Jamaica’s top banking conglomerate.
In an interview with the financial gleaner he acknowledged that his business is venturing into a market dominated by NCB, namely loan issuance, but said he subscribed to his grandmother’s saying that “there is room under the sun so that everyone shines”.
He also noted that he had his father’s support to chart his own path.
“I have never been associated with the NCB group. I have always avoided the family business,” said Lee-Chin Jr.
As for the evolution of seed investments, he said that in January he started researching digital banking firm Nubank, run by billionaire David Valez, and eventually realized that although there Although there were many financial institutions, there were none in the online space that had the unbanked as their focus.
“I thought to myself this is really something where I can help people, especially those who are not part of the banking system,” he said.
The immediate idea was to take the business to Africa, where there is a larger population and, therefore, greater opportunities for growth, but Lee-Chin Jr chose to come to Jamaica first, where it has connections and access to resources. He then posted a vague announcement on LinkedIn simply saying “need a Jamaican banker”, to which there were many responses, including from cashiers.
Lee-Chin Jr said that after a series of interviews, Andrew Patterson turned out to be a good candidate, coming as he did with his experience in the financial markets and running his own microfinance operation. The two then teamed up with data scientist and director of analytics company Starapple, Adrian Dunkley. Lee-Chin Jr owns 51% of Seed Investments while his two partners own 24.5% each.
Lee-Chin Jr says he invested $3 million in the startup. The money comes from the sale of a property he owned in Jamaica and his savings.
“I have invested the profits in starting this business with the idea that I will build this business and make it profitable, encouraging potential investors to grow further. The first stop is Jamaica, and the next stop is the Caribbean,” he said.
Asked about the meaning of the name “Seed”, Lee-Chin Jr said that after exploring a number of names, he received divine inspiration during morning prayers. “I really see this company as a ‘royal’ company; one that will be there for a long time. The benefits will be good when they come, but they will be a by-product of our doing good. That’s why we are here,” he said.
Seed investments will target people who do not have easy access to finance or who would otherwise have difficulty obtaining the necessary support for their projects.
“Our customer is everyone, but I really have a soft spot for the underdog, the unbanked, the underbanked,” said Lee-Chin Jr, adding that the key difference with Seed is that the company will only look not credit history to determine loan approvals.
“We don’t look at your past. We have, through our special scripts from our data scientist, where based on the questions we ask you, we will have a better picture of you than if you walked into a bank,” he added.
The company will rely on data analysis to assess the risks to potential customers. Loan processing will be done via mobile phone or Wi-Fi enabled devices. The process will be fully digital, from application to approval to disbursement of funds.
Seed Investments became operational on Monday, October 24, but is not yet in a position to make loans, saying it is still awaiting approval from the Bank of Jamaica.
The central bank, which recently took over supervision of microcredit institutions, requires all new and existing players to acquire an operating license.
Lee-Chin Jr says that for now, his company will focus on customer engagement and marketing until approval to issue loans is granted.
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