Outre Finance by Kachi - Transforming finance through decentralization

[KachDN]

Project Name: Outre Finance
Project Track: DeFi
Team Name: derrick56_3c73
Team Member(s): 1 (@KachDN)
Project Website: www.outrefi.com

HackerEarth Project Link: Submission
Demo Link: Pitch and Demo video

Android App:Download APK

Project Goal: Empowering individuals with transparent, accessible, and inclusive financial services.

Project Value:

The project aims at improving utilization of financial products, onboarding the unbanked and underbanked to web3 and DeFi, and foster financial resilience through a simplified platform while building users credits scores and credit worthiness on-chain.

Project Info:
Outre-Finance is an effort to build a borderless, customer-centric, all in one platform to serve as a trusted companion to manage and grow money while giving back control to users. By simplifying web3 for the less tech and financial savvy, we intend to increase utilization of financial products across sub-Saharan Africa. The “take it or leave it” approach to financial products and pricing has locked out many, especially in the informal sector, from enjoying the benefits of current financial trends. Many in the informal sector underutilize these products due to high learning curves, costs and the commitment involved. While making payments is easy, participating in mediums that expose them to cheap lines of credit and saving pools still has high friction. We know that making and receiving payments is not enough to build financial resilience and inclusion. Designing services that improve payments to make them safe, cheap, and fast while enabling alternative lines of credit, debt management and connecting individuals into saving pools will highly improve involvement.

Key Project Features

Outre Spaces

Outre spaces is basically a savings feature where users can save for personal goals, participate in saving challenges and also save in groups through RoSCAs. With Rotating Savings & Credit Associations (RoSCAs) users can come together as a group to help each other stay financially resilient. Users contribute to a pot, and the target amount goes to one of the users in a particular order until everyone has received a pot and the cycle starts over. This utility commonly known in Kenya as Chamas, helps many raise funds for otherwise big financial goals such as business capital or bills. Within the RoSCAs members can also ask for financial support for financial needs outside of the pot allocations. Users can create a RoSCA easily by inviting their friends through their phone numbers. Once the RoSCAs is created they can select their admins and around can be started. Funds disbursement happens automatically once a pot deadline is reached. Signatories to the RoSCA funds are randomised by the platform in order to give all members equal control over their funds.

Outre P2P Lending

68% of loans in the alternative lending market in Africa are P2P loans. With Outre P2P users are able to offer or request loans from each other at their own terms. Outre Finance helps with monitoring the Credit scores of users and only recommending matches to users in order to minimize the risk of default among users. This feature is very useful for those who survive on day loans to run small businesses for purposes such as inventory purchases. This product greatly reduces the cost of loans as it democratizes lending and also opens other earning avenues for users through interest.

Project Repo: The Projects Code

Smart Contract links:
Contracts Package on Github

• Spaces Contract
• Sample Rosca
• Loans Contract
• Loans Offers and Requests
• Sample Loan

License: Apache v2.0

Project Milestones

• P2PLoans smart contracts development
• Spaces and Rosca smart contracts development
• Smart contract tests
• App development in expo
  • Essentials features (Home, deposit and transfers)
  • Spaces features (Spaces home, rosca creation flow, rosca funding)
  • P2PLoans features (Loans home, Offers listing, Requests listing, loan funding)
  • Wallet features (Balance and transactions lists)
• Contracts and app intergartion with tronweb and trongrid api
• Simple website (Landing page)

Try it yourself and give us feed back!

[Kojopapo]

Welcome can wait to hear more.

[HODL]

Welcome to hackaTRONs5 ! It’s a challenging task to onboard from the informal sector. Keen to see what your team comes up with. Wish you all good luck !

[Prince-Onscolo]

You are welcome team.
I read something like grow money, I like that because I like passive income. Waiting for more details… Let’s see how it goes

[Okorie]

@KachDN
What a nice and interesting topic but after much reading have some important questions.

(1) In what way does Outre Finance plan to simplify web3 for the less tech and financial savvy.

(2) In what manner does the specific financial products and services that Outre Finance will offer.And how will the outre finance enable alternative lines of credit and debts management.

(3) How will Outre Finance make payments safe, cheap, and fast.

(4) By what means will Outre Finance connect individuals into saving pools.

(5) By what method will Outre Finance measure its success in terms of empowering individuals with transparent, accessible, and inclusive financial services.

[manfred_jr]

Welcome to Season 5, it’s interesting to see your project in the DeFi track, more interesting to see offering to provide irl solutions in Sub Saharan Africa. After a careful read, I deduce that it’s clear that the project “Outre Finance” aims to address financial inclusion in sub-Saharan Africa’s informal sector through DeFi (Decentralized Finance) solutions.
Now my question is bordering on “Regulatory Compliance”; DeFi projects often face regulatory challenges. How does the team plan to navigate any regulatory hurdles, especially in a region like sub-Saharan Africa?

[KachDN]

Thank you for your interest @Okorie

Of course simplifying financial products is not a simple.

1. At Outré finance we aim to design of products based on the actual needs of our target users by aligning them with what they are already familiar with. In Kenya for instance one can send and receive money via a text message with their phone number as a channel. Leveraging this simple medium, we intend to offer the same experience by enabling users receive stable coins in the same way without worrying about memorizing their address as most only use feature phones.

2. Most of those in the informal sector do not have access to credit because they do utilize banking products or are unbanked. Outré finance intends to build their credit score and hopefully build a financial profile for such users so they can appear credit worthy to other institutions. Also since most already lend to each other informally we believe we can help by building a formalized P2P lending product as an offering.

3. Safe, cheap and fast payments are really important for our target as mostly what they send is certainly all they have. Any friction experienced will lead to very bad impression. Outré finance intends leverage account abstraction to help streamline transactions within our platform.

4. In order to connect individuals to saving, we intent to start by bringing the utility of RoSCAs to web3. This is the most common way our target users save together and help help each stay financially resilient. By building upon this, users can create or join saving groups as easy as joining WhatsApp groups and later we can expose this groups to other DeFi products and grow their savings.

5. Our success will be measured by the utilization rate of our products are this is what we are trying to solve. What is the growth rate of our MAU and how are they growing financially over time. Either by how active they are in the Saving pools or how they are handling any debt they may have taken. Of course as we build we will develop more specific metrics to measure utilization. A simplified and useful product should be sort at any time of need.

Wow, I think I should include this the project details.

[KachDN]

Thank you @manfred_jr for your question.

This is true, Regulatory compliance is a big challenge especially here in Africa where most governments are yet to get the ropes of Crypto and DeFi. As we start out the project, and since we are building this in Kenya (East Africa as our first market), we intend to look into what policies they have around e-money (Digital funds in Kenyan fintech) and build around this.

The biggest concern is normally deposit taking, we at Outré finance aim to be non-custodial by leaving the users funds with the users and by only providing a facilitating platform we absolve ourselves from being a deposit taking entity hence avoiding the need to setup ourselves as a “bank”.

Secondly, Kenya might be ahead of the rest, and have set up a Capital Markets Sandbox, that Crypto solutions can join and offer the service while working closely with regulators to streamline compliance. We think this will give us good insights on how to navigate this market.

Finally, KYC is mandatory for us as we try to build the financial profile our target users.

[Nana66419]

Welcome to season 5 and its always good to have people come onboard with bright ideas like this one.

We all know people in the informal sector are mostly unbanked due to alot of factors.

1. They lack the right education to be well equipped to use these technologies we are trying to build for them.
2. They lack the right gadgets and tools to help them to grab this opportunity the project seeks to offer.
3. The fear of how sustainable the project will be in the long term.

How does Outre Finance plan to approach these challenges.

Thank you and wishing you all the best

[manfred_jr]

This is really getting interesting moving forward, I’ve my eyes on this as I’m African to the core. It’s great to see that you’re considering the regulatory challenges in Africa and taking steps to address them.

Thanks to @Prince-Onscolo, I’m now really big on security. The decision to be non-custodial by letting users retain control of their funds is a wise strategy to avoid complex regulatory requirements associated with deposit-taking entities. How will you ensure the security and accessibility of users’ funds within this model?

Then again, mandatory KYC is essential for building trust and complying with anti-money laundering regulations. How will you handle user data securely, and what KYC processes and technologies will be used?

[Prince-Onscolo]

Great to hear this, you are aware of the challenges and you are ready to face them. Good let’s put this into practice

[Nweke-nature1.com]

Welcome to Grand Hackathon Season 5, good to see how your project will solve problems in the society but am looking forward for more of your project details,… wishing you all the best though

[KachDN]

Hello @Nana66419 thank you for chiming in.

Well financial products need to exist for needs and not just coz we can build.

1. Most financial products are complicated and don’t align well with users needs. In order to help a user understand what problem the solution is trying to solve the user has to relate with the problem or somehow be able to experience the problem 1st hand. We at Outre Finance are looking at what our target group is doing to stay financial resilient and try to align this with the our solution. In the case of RoSCAs, it easier to explain to them that they can achieve a goal easily together than being alone and trying to balance needs, also within this group its easier for them to learn together than on their own.
2. To address the lack of gadgets. We at Outre, are trying to be mobile first and by mobile we don’t want to be limited to just the smartphones but also feature phones. This way, even those without mobile data or access to data can access the blockchain and DeFi.
3. Sustainability is also a very vital area to work on. By being non-custodial, we want to give our user the impression that their journey in DeFi should be beyond our existence. Prosperity means giving our users freedom to try out other products in the ecosystem after learning the ropes from our solution. Afterall, they are the owners of their own keys.

[Nana66419]

Thanks for the explanation, i really love how you have taken the time to break down everything.

Please before a user can use your product, are you going to charge any subscription fees or will there be any charges the user will be made aware of??

[KachDN]

Key management is not an easy or straight forward thing to handle.
Our biggest challenge so far has been how best can we help the user stay in control while keeping the UX as simple as just using PINs for transactions.
Our approach is for the current project is to try and employ industry standard encryptions during transactions and not store users keys anywhere in our platform. Later we plan to source or build an MPC key management solution.
User funds are stored in smart contracts owned by the users. An example of how this would work is, when a user creates a RoSCA, a new contract owned by only them is deployed and funds stored here can only be controlled by them. this way we will not have access to the users funds but only them.

For users personal data, we only intend to process ownership of their phone number as this is the form identity we can associate the user with. In Kenya, this is simple as we can crosscheck this with the national database. Users can choose to link or unlink phones numbers to their addresses. In other jurisdictions, we will have to employ 3rd party KYC solutions during the phone number verification process and if that is okay we proceed to onboard the user. We have not settled on this particular solutions yet.

[KachDN]

Thank you @Nweke-nature1.com Details coming by the end of the week.

[Nana66419]

I don’t know how phone number verification works in Kenya but in Ghana here its a total disaster.

We have people registering sim cards using their national id cards and later selling those cards to other peoples for a fee.

So when there is an issue with that number it is traced to the original owner but the original owner might have forgotten who he sold it to.

Since your project is for the sub saharan African as your target group. When you get to Ghana kindly use the KYC approach.

[KachDN]

We are still working on our model.

Given our customer base, we will not charge subscription fees to use our services. However, we intend to work away to introduce non prohibitive fees on some solutions in a way of facilitation. For example, in the P2P lending, fees will charged after matching the lender and borrower, this way posting a loan offer is free and also users have access to the loans list.

Our saving solitons will also not incur any fees but a form of revenue share may be introduced in some yields gained from such savings. Users will at all times see this information.

Having no hidden fees means a more trust worthy product.

We will be developing our business model as we continue. However we believe our impact comes from how many users lives are improved by our product rather than how much we make from them.

[ElisSenaVatansever]

Still waiting the website part, when do you plan to share it ? Your info explains everything really well.
I want to see prototype

[manfred_jr]

Your approach to key management, user funds, and personal data appears to prioritize user control, security, and privacy, which are essential in the DeFi space. Balancing user convenience with security and privacy is crucial. Did I mention, I’m also big on passive income, taking profits and incentives, that brings me to one question;

Building or sourcing an MPC key management solution is a forward-thinking step. To ensure user adoption, will you offer incentives or guidance for users to transition to this more secure solution when it becomes available?