Comunidad 4UNO

The first affordable financial platform that connects low income workers and their families to financial institutions and their products.

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Eligibility

  • Yes, I fulfill all of the eligibility criteria.

Initiative's representative name

Miguel Duhalt

Initiative's representative date of birth

june 7, 1980

Initiative’s representative gender

  • Man

Which eligible market are you based in?

  • Mexico

Where are you making a difference?

Mexico nationwide

Website or social media url(s)

https://www.facebook.com/4uno.org/ https://twitter.com/Comunidad4UNO https://www.instagram.com/comunidad4uno/

When was your organisation founded?

03/2016

Focus areas

  • Helping people adapt to technologies of the future
  • Financial skills and capability
  • Reskilling and upskilling the workforce
  • Creating digital tools

Project Stage

  • Growth (have moved past the very first activities; working towards the next level of expansion)

Yearly Budget: How much capital do you need to accomplish your proposed project?

  • $1mil - $5mil

Organisation Type

  • Hybrid

1. Founding story: Share a story about the "Aha!" moment that led the founder(s) to get started or the story of how you saw the potential for this to succeed

This project was shaped by the people in need since its beginnings. Four years ago I lent Don Filo (my doorman) US$ to buy three piglets that he fed and sold for more profit. With these gains he was able to fix his shower heater, as his family had been bathing in cold water for eight years. I continued to lend Don Filo more money, effectively becoming his line of credit. Later I helped him keeping his savings safe. I ended up doing the same for the other doorman and the domestic worker and developed an app in order to keep track of all the loans and savings. Finally I realized that If every employer were to bring the platform to four individuals who are not included, financial inclusion for Mexico’s entire population would be a reality.

2. The problem: What problem surrounding employability or financial capability are you helping to solve?

2.5 million domestic workers are paid cash without any benefits and with no access at all to formal saving products or loans, thus bearing a high level of risk and vulnerability. Yet, we have identified and proved that the root problem is not the lack of products, but the lack of an effective distribution system allowing low income workers access to affordable financial product.

3. Your Solution: How are you planning to solve this problem? Share your specific approach.

We built a profitable and scalable three-sided digital platform formed by workers, their employers and financial institutions. This platform leverages the strong relationship between workers and employers to include workers into the financial system by enhancing financial transactions which are already happening between them. In this way, employers act as a distribution channel for account activation and relevant financial services. On the other hand, the platform is digitally connected to some Mexico leading financial institutions in a way that while opening new markets for them, simultaneously offers existing and low-cost products to an unserved population. This allows us to offer financial products for less than USD $3 per month. The employer of an informal low-income worker purchases a membership which includes: a one year personal accident insurance coverage, indemnity insurance for any surgery, free medical consultations, a savings account and a debit card allowing worker to get electronically paid through the platform. This helps workers receiving regular salary, saving money, allowing them to generate a credit history, and eventually having access to formal credit.

4. How are you innovating or using unique approaches to solving the problem?

1. We have created a digital highway where financial institutions can distribute their product through our proprietary Whatsapp based app (95% of workers use Whatsapp as a communication tool) . 2. We have a seamless 100% digital onboarding (for feature and smartphones) where employers and workers do not have to sign anything, do not move to a branch to sign in and start using our product. 3. Financial products are delivered 100% digitally. For instance, workers have 24/7 doctor by phone. They can access their salary and payroll loans from any ATM, retail and convenience store. 4. We are first fintech with a network marketing app that helps our customers to become entrepreneurs and earn money selling financial products to unserved users

6. Financial capability: how is your organization or project creating innovative solutions that arm people with ability to optimize their current and future financial health

First, workers can access the formal financial system and reduce vulnerability through relevant solutions as a savings account where they get their payroll transferred, with a VISA debit card are able to withdraw the amount they wish from any ATM, or to use this card to pay at any point of sale, thus reducing the risk of carrying cash around. They are also able to receive loans or other financial services. Second, these bank accounts can have saving accounts attached where workers can have long term saving plans. Third, all workers receive an insurance including in-work accident coverage and 24-hour free primary care assistance either by phone, at home, workplace or any private hospital. Fourth, informally employed workers in Mexico can now be incorporated to the IMSS (Social Security Mexican Institute).

6a. Please describe what aspect of financial capability your organization is focused on fostering and how you have measured / plan to measure progress.

Our goal is to improve low income workers financial health by reducing the probability and time to solve an unforeseen financial shock. If we achieve that, they could be able to focus on their financial goals such as buying a house, provide a better education to their children, launch a business or save for retirement. Thus, we are focused on measuring their financial health from five angles: 1. Increase their income and expenses gap 2. Increase their formal savings 3. Increase their access to formal credit 4. Better planning through insurance 5. Increase their financial education.

7. Marketplace: Who else is addressing the same problem? How does the proposed project differ from these approaches?

Our main competition is the inefficient financial system that doesn’t reach all the unserved population. Other financial institution such as banks, insurance companies can become competitors, however, these Financial institutions do not focus on the same population nor do they have the same objectives. We are becoming a complement rather than a competitor. We have become an Amazon-like distribution channel for them to commercialize products to an unserved population.

8. Impact: How has your project made a difference so far?

Starting in 2017, the first rollout of the platform focused on domestic workers in Mexico, We have given financial inclusion to more than 4,500 workers in 30 cities. 1,000 women workers have access to formal credit for the first time and 200 workers have their first revolving credit line. We have provided free medical consultations to more than 2,000 workers and 1,000 of their sons and daughters. We have covered 100% of the accidents of more than 50 workers. Around 300 workers are saving money in a formal savings vehicle for the first time. And we are measuring and improving the financial health of all our users. We won the Metlife Foundation competition where we won as the best Financial Institution in LATAM and won Mapfre Foundation as the most innovative insuretech in the world. We are one the 20 most innovative startups for Future Work Awards and in 2018 I became Ashoka Fellow.

9. Financial Sustainability Plan. Can you tell us about you plan to fund your project and how that plan will be sustainable in the short, medium, and long term?

We have raised more than US 2.5 million in funding. 80% from four large international equity investors, one of them is Gentera, the largest MFI in Latam and 20% from grantors such as Metlife, Bill Gates Foundation, JP Morgan and Fundación Mapfre. Our plan is divided in three stages: 1. Short term. We will keep growing our platform in order to become the leading distribution channel for domestic workers in Mexico. 2. Medium term. With our recent equity financing, at the beginning of 2021, we will scale our solution to SMB's low income workers and workers in the gig economy in Mexico. 3. Long term. At the end of 2021 we will raise our 3rd equity round of US$ 5 million to scale our platform to other regions in Latin America

10. Team

We are 11 full time employees. We have people who have worked in small and large companies, thus achieving a great balance by being creative, fast and disciplined, sticking to processes that have worked out for larger companies as well. We have people in four main areas product & technology, sales & marketing, customer service and operations. We have a board of directors composed by four investors and one director that represents the company. We also have a HR, Admin and strategy committees.

Help Us Support Diversity! Are you a member of an under-served , under-represented, or marginalized group in your country of residence? (yes/no) (this question is optional – if you choose to fill it out, the response will not be shared with your fellow contestants)

  • This does not apply to me

How did you hear about this challenge?

  • Ashoka page or contact

11. Bring it to life: Please walk us through a concrete example of how your solution will solve the problem you’re trying to address

Here is a google translation from one of our customers. Hi, I'm Lety, I'm a domestic worker. 4UNO has helped me a lot because now I can receive my money in a debit card and now my money is safer because my money has been taken from me three times in public transport. In addition, I only withdraw what I will need in the week and I leave a little as savings. I also like the medical service because a month ago I felt bad and I thought it was coronavirus but I spoke to the doctor and he told me it was a flu and that I shouldn't worry. It's great that my children also now have a free doctor because my 6-year-old son is very ill and we have visited a pediatrician twice. Also a year ago I slipped and broke my finger and I went to the hospital and they covered my expenses. I have told my sisters and friends a lot about 4uno because it has helped me a lot. Hopefully more people have it.

12. Skills Matching: HSBC Employees will have the opportunity to offer skilled-volunteering. If matched, which of the following skills would you be most interested in receiving?

  • Planning & Strategy
  • Board Development
  • Marketing Strategy, Design
  • IT Infrastructure/CRM

13. Financial Sustainability – funding breakdown: please list a quick breakdown of your funding, indicating an estimated percentage that comes from each source.

individual investment 5%

foundation or NGO grants 10%

corporate contributions 80%

earned income (product or services sales, licensing, franchising, consulting, financing, etc.) 10%


14. Financial Sustainability – please tell us more about how you plan to fund and scale your project over the next 12 months.

As mentioned earlier in December 2019 we raised a US$ 1.5 million equity investment from three international VC funds and a large Micro-finance Institution. With this investment we have a runway of 24 months and we will focused on strengthening our team, specifically our product and tech development team and our sales team. We are also investing in marketing. We have decrease our customer acquisition cost to USD $20. Nevertheless, we will keep investing to decreasing it more through network marketing (sales reps that earn a 35% commission) social networks and viral marketing. We are investing in product development as well. We hired an innovation and strategy agency to understand much more our customers and enhanced our product portfolio. Finally we are investing in improving our communication and branding in order to connect better with our audience.

15. Growth Strategy: What are your main strategies for scaling your impact?

I. Consolidate our model and solution in the domestic workers segment. We expect to impact more than 100,000 domestic workers in the next three years.

II. Start replicating the proposed solution to the 26 million unserved Mexican workers through SMEs and gig economy platforms which generate 78% of all employment in the country.

III: We will scale our solution to other countries in Latin-America by partnering with local organization and leveraging the strong presence that our current allies in Colombia, Peru, Argentina, Chile and Guatemala

16. Activating changemakers: How are you giving people the power to control their own destiny and support other people to become changemakers in their communities?

Our most important scaling pathway is enabled by a successful network marketing program that has been named Social Ambassadors. 100 employers and workers, are referring and subscribing 300 domestic workers per month. This channel has allowed our current customers to become changemakers because they become part of the solution. Instead of paying thousands of dollars to media companies such as Facebook or Google we are channeling that investment to our own customers (employers and workers), thus strengthening our ecosystems.

17. Awards & Recognitions: What awards or recognitions, if any, has the project received so far?

First place Metlife Foundation as the best Financial Institution in LATAM. First place Mapfre Foundation as the most innovative insuretech in the world. We have appeared in many local and international media:

Next Billion. https://goo.gl/kLajQx, CGAP. https://goo.gl/Hqasn3, Catalyst Fund blogpost. https://goo.gl/qivFo4, Forbes. https://bit.ly/2GptnIB, GoBizNext. https://goo.gl/6rvUzu

18. Tell us about how collaborations and partnerships would enhance the scalability and impact of your project

4UNO was designed as an open community where knowledge can be share and be used by other organizations to positively impact the lives of many more people. So far we have achieved collaboration and partnership with important institutions such as BBVA, Axa, Mapfre, Metlife, Gentera, IMSS (Social Security Institute) and others. We have shared our knowledge so they can use it to help other people and organizations that are focused on improving the financial health at the base of the pyramid.

Finally - Your Selfie Elevator Pitch: Share a 1-minute video that shares a quick summary of the problem you would like to solve, how you’ve chosen to solve it, and the impact you hope to see.

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