Amelia is a 19-year-old with an entrepreneurial spirit. She and her mother run a warung, or a small shop, in Serang City in the province of Banten in Indonesia. Their store is both a retail and wholesale operation, and the bulk of their customers — both resellers and shoppers — are their neighbors. They’re in a tough business. Shops like theirs often rely on cash sales of a large selection of low-margin products. Working capital is tied up in inventory, which must be regularly replenished, leaving the stores lacking liquidity. These conditions can make sustaining a shop difficult, and even harder to grow.

Amelia’s mother opened her store in 2007 and has kept it running ever since. Having grown up alongside the business, Amelia thinks a lot about the store’s long-term prospects. She knows what differentiates her store from others: convenience and selection. Staying stocked with fast-moving consumer goods (FMCGs) like toiletries, food, and medicines is how she stays competitive. But that requires working capital.

“Having more capital allows me to fill up the store so the customers will keep coming,” she says. “They don’t want any hassle. If my store has everything that they need, it will make them happy.”

The majority of microbusinesses in Indonesia are owned and managed by women like Amelia and her mother. Around the world, women are less likely than men to be able to access formal financial services, and this exclusion extends to women who start their own businesses. Operating in cash, as Amelia and many others do, makes it difficult to receive loans that help their business grow. While they may have turned to informal lenders in the past, accelerating digitization can make affordable lending available where it wasn’t before.

“I had never tried applying for a loan before, either to banks or other online loans,” Amelia recalls. When she needed working capital to buy more inventory, she sought out a safe source of credit from a credible provider. Her research led her to Fairbanc.

Fairbanc is an embedded tech platform that provides inventory financing in the form of seven-day payment terms for small retail shops like Amelia’s. They offer a buy now, pay later product that is integrated into the inventory ordering apps of large retail partners. This seamless integration vastly expands access to the financing that shops need to grow and build resilience. Their platform removes cash from the equation and allows small retailers to purchase more inventory when experiencing increased demand from their customers.

Amelia at her shop in Indonesia

“It wasn’t difficult to get the credit. I even think that it’s easier because the process is uncomplicated. Fairbanc doesn’t require collateral, and we pay the amount invoiced without interest charge,” says Amelia.

Accion Venture Lab invested in Fairbanc because we believe that accelerating digitization responsibly can uplift and empower vulnerable people. Accion is committed to nurturing innovation through fintechs like Fairbanc, helping them to develop new digital products, address clients’ shifting needs, and scale solutions that show potential to improve financial inclusion for women.

In developing their product, Fairbanc made a concerted effort to understand the hurdles Indonesian entrepreneurs like Amelia and her mother face, including the lack of financing options and the challenges of running a retail establishment. They offered a solution that is data-driven, efficient, easy to adopt, and that creates a virtuous cycle. Customers receive credit, grow their business, qualify for further credit, and continue to grow. The owners’ economic circumstances and those of their communities improve substantially.

With access to inventory financing now available, Amelia has even higher aspirations for her shop. “I wish that my store would grow bigger in the future, to be a bigger wholesaler. With today’s competition, I hope that my store will remain on top,” she says.

Watch how women entrepreneurs like Amelia have grown their businesses using digital financial tools.

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