You don’t have to be a genius to manage money well, but it may take someone with expertise to make access to banking a tad easier — and one Easton area teen with engineers for parents just might fit the bill.
Meet Okezue Bell, the 17-year-old founder of Fidutam, a micro-financing, block-chain phone application created for the sole purpose of eliminating barriers to standard banking for people who qualify as asset-limited, income constrained, but employed (ALICE) and “unbanked.”
In short, Fidutam gives loans to people who might not otherwise even qualify to open up a bank account at a formal bank or credit union, at no interest at all.
And last month, the company received $15,000 through the Prudential Emerging Visionaries program to continue its work, which already supports some 750 unbanked people around the world, including in Uganda, Kenya, Nigeria and 100 users in the U.S., Bell said.
The Emerging Visionaries program is hosted annually by Prudential Financial in partnership with the social entrepreneurship network Ashoka, and advisory support from the Financial Health Network. The program recognizes young people between 14 and 18 years old across the United States for leading initiatives that result in fresh, innovative solutions to today’s financial and societal challenges, according to the program’s website.
Twenty-five grant winners were named in February. Each earned a $5,000 award and an all-expenses-paid trip to the Emerging Visionaries Summit, where five of them, including Bell, were selected to pitch their businesses for advancing financial equity to a panel of judges. They were each, then, awarded $10,000 each.
Fidutam is currently in its Beta stages, Bell said.
According to a report by the Financial Deposit Insurance Corporation (FDIC), in the U.S. alone, nearly 6 million households (4.6% of U.S. households) qualified as unbanked in 2021, which means no one in the household had access to a checking or savings account at a bank or credit union.
Globally, the World Bank estimates no fewer than 1.4 billion fall under the umbrella of “unbanked” or “underbanked.” It’s called the unbanked crisis, Bell said.
“That means that’s how much economic potential is being lost, not just in America, but across the world,” Bell said. “And unfortunately, it happens to be most affecting people who are already in vulnerable situations — refugees, oftentimes people of color and immigrants.”
Resolving roots of being unbanked
The causes for being unbanked are numerous.
They range from unexpected job loss and account closures to not meeting minimum banking requirements to open a bank account, or simply not having proper identification, and, in some cases, illiteracy.
Fidutam works by resolving all of those obstacles from the start, Bell says. Fidutam users only need a phone, a selfie and a name. Then a program designed by Bell does the rest.
Users approved to open a Fidutam account can receive a phone that runs the program from participating nonprofits that help Bell screen applicants. The user-provided selfie is used to generate a unique, encrypted account number and that’s it, Bell said.
Block-chain encryption is considered by some to be more secure than standard banking security systems because the data is decentralized, according to reports.
Fidutam users can then begin requesting sums as high as $100 to use for individual needs or businesses. At the moment, the company is prioritizing applicants who identify themselves as future or current business owners and who intend to use the lending system to support their companies, Bell said. Members typically sign a one-year repayment agreement.
Bell said he heard back from one Fidutam user in the Bronx, New York, who worked full-time as a machine operator in a factory. He said the member used her microloan to finance a purchase of plain, steel-toed boots, which she customized and then resold to her coworkers at a profit.
“Fifty dollars can be as useful as an individual chooses to make it,” he said. “And if an individual is really determined and supported appropriately, they can grow that investment pretty significantly.
Outside of the U.S, in places like Kenya where $100 is worth ten times its U.S. value in Kenyan shillings, the impact of the program has “crazy implications,” Bell says. According to one unbanked Kenyan member piloting the program, having the unique, self-sovereign identity (SSI) code (or encrypted ID number) created by Fidutam allowed her to get more work as a birthing assistant because the code was considered equivalent to having a bank account.
But Bell insists this is not banking for low-income people. It’s a banking strategy in a time of economic crisis that could help low-income people gain enough capital to enter the formal banking system, he said: “We’re trying to integrate them into the economy, rather than create a new economy just for them.”
And then there’s still the lingering question. What happens to loans that don’t get repaid? Bell says his company eats the loss.
“I think that’s one of the beauties of microloaning,” he said. “It’s not a big deal if we lose $75 or $100. Now if we kept losing $100, it would be an issue but that’s part of the reason we’re specific about the individuals we work with and why we work through on-ground nonprofits to help us vet individuals.”
Interested in learning more microfinancing? Here’s a video to learn more about how the system is being used to benefit low-income and economically siloed individuals around the world.
Founding Fidutam
Learning new things is Okezue Bell’s passion. The evidence of that is scattered around his work room at his parents’ home in Palmer Township, where he keeps his wires and gadgets, books and 3D-printed, mechanical models of various prosthetics he’s building.
It only takes Bell a moment before he’s off and chasing his next endeavor and taking what he learns to create a solution to someone else’s problem, and founding Fidutam wasn’t any different.
The Fidutam that Bell works on today wasn’t the original vision, he said.
The company initially got its start as a credit card security program in 2020 for the sake of a high school business competition through the Distributive Education Clubs of America (DECA), in which Bell and his classmate and cofounder Wisdom Ufondo came in fifth place.
The duo didn’t make it to the international portion, Bell says, but they were not disheartened. They knew they were on the right track, so they went back to the drawing board. The next year they not only made it to the international round, they also took the top prize.
But something was still missing for Bell. He wanted to see a heftier social impact come from the company, he said.
“We were seeing so many, not only racial, but socioeconomic disparities still being perpetuated here in the U.S. and from the way I saw it, it all boiled down to finances and it boiled down to a lack of presence in traditional banking and the formal economy and things of that nature” for unbanked people, Bell said.
Some conversations on microlending with unbanked people in Uganda, showed Bell, who was the sole founder of the new business at this point, all he needed to see. The women were using the microlending system to support businesses as traditional birth attendants, so they could make a profit, he said.
He took what he learned from those conversations, plus discussions with groups like Bank on Allentown, Bank on Chicago and JPMorgan Chase launched the latest version of Fidutam.
Fidutam is a portmanteau of two latin words which roughly translate to security and safety. In his latest venture, Bell said, he was inspired to carry over the name because he wanted to keep the original inspiration for Fidutam alive.
“The idea for Fidutam idea was not mine,” Bell said. “I like to say it was actually the idea of unbanked people who voiced their concerns to me, and I only converted that into technology.”
In the fall, Bell says he’ll take his passions into pursuing math and electrical engineering through the Symbolic Systems Program at Stanford University. Bell graduated this month from Moravian Academy.
Bell is also the founder of WeArm, a low-cost prosthetic arm
Bell advises Perfect Day alongside Leonardo DiCaprio, the American Lung Association, the United Nations, and more on climate and education policy, and hosts STEM workshops that have reached more than 65,000 students across 42 countries and 75,000 students across 80 countries and 27 states overall. He’s also published graduate-level research at the Massachusetts Institute of Technology, Research Science Institute and Harvard University.
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Glenn Epps can be reached at gepps@lehighvalleylive.com or glenn_epps_on Twitter.