The Alternative Financial Services Association of North Macedonia
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Close to AFD members: Tigo – interview with Filip Dimitrovski, the director of Tigo Finance

  1. First of all, who are Tigo Finance?

By definition, the only answer would be non-banking finance company, or more precise FinTech company licenсed by Ministry of Finance of Republic of Macedonia, which offers easy simple and quick solutions for supporting physical persons, with a purpose to intercept with their financial needs. We are present on the market for over 3 years, more specifically from December 2017 when the company was founded.

However, if I expand my answer, I would say that we are a contemporary company with high ethical and professional standards and with solidly rooted values which are used at the highest level, with our clients and to the corporate culture of the company and the employees, but also in the general actions of the financial market and in the community, that has serious intentions to improve the population purchasing power and to improve the financial inclusion of the social stratification.

From the aspect of our product, we prefer to state that we offer a product, for the citizens who need a financial support in a quick, simple and transparent way, in the moments when they need it the most. We offer credits from 2.000 to 80.000 denars, with an application process and approvement estimated in less than 10 minutes, thanks to the advanced technology we are using. The advanced and complex algorithms are providing full assessment on the creditworthiness of the applicant, so that way in only 30 seconds the clients will receive information if their application is accepted, and in a couple of minutes they will have the approved amount: something that is extremely important for the customers and is positioning us as one of the leading brands in the industry of the non-banking financial companies.

During these 3 years, Tigo provided access to finance with an amount of over 30 million euros for citizens who needed funds, of which more that 60.000 are unique clients.

In this moment, Tigo has more than 80 employees, top professionals in their field, currently has 15 branch offices in the whole country, and with the current dynamic of expansion which will proceed until the end of this year, we expect around 30% growth in the number of employees. All these data speaks in favor of our strategy for obtaining a quick, simple and transparent access to finance being proper and accurate and we remain to move in that direction.

  1. You are the executive director of Tigo, and also the President of the Association of Financial Companies of North Macedonia, so in that position what are the advantages to be a part of such an organization?

Tigo Finance is one of the founders of the Association of Financial Companies of North Macedonia. The presidency of this Association, above all, gives an exceptional advantage that together with the other memebers of the Association we can act more powerful in the way of creating a responsible practice, with a purpose for a long-term collaboration and a positive judgement by the consumers and the institutions for regulating the market. In fact, with signing the Codex for good practice all the members of AFD formally commit to responsible lending and providing a higher level of protection of the clients, but also providing clear rules for collaboration with the clients which took a loan or are planing to take one from the member of the Association.

AFD stand for the overall development of the FinTech industry in North Macedonia, so the foundation of the Association was an answer for the need to raise the quality of working in the sector. Although the industry is already positioning as a serious actor in the financial market, it is still relatively young, so from here as members of the Association, we have an obligation to acts together for providing unified standards for quality of the industry, but also guarantee safe, socially responsible and sustainable lending practices for customers. Additionally, as an Association, we are actively working on promoting a collaboration with the competent institutions, so in that direction, as members, we have an opportunity to initiate meetings and collaborations with different actors of interest and to act in a way of strengthen the relations with the regulator regarding the decisions that refer to the industry of non-banking financial companies and are relevant to our work.

All of this represents an advantage to be a part of the Association, but on the other hand it is also a big challenge and a responsibility to talk in the name of the overall sector of non-banking financial companies.

  1. How did the Covid-19 crisis reflected on your work in North Macedonia?

The health and economic crisis undoubtedly affected the whole business sector, so the FinTech industry was not immune to the crisis neither. The biggest challenge was maintaining the liquidity, knowing that the non-banking financial companies are financed from their one resources, unlike the traditional financial institutions that work with the population’s deposits and other cheap sources for funding.

On the other hand, the need for financial services, in a crisis or not, will always be present and that is the leverage in the non-banking financial companies, because one of the main purposes of this sector is enabling inclusion for the financially unserved population by the traditional financial system. However in Covid conditions, when the duty of the financial companies was even more significant, from the mentioned challenges, the ones who suffered the most were the citizens which in this crisis period had the biggest need of alternative financial services.

This situation taught us that for the progress of FinTech we strive for, there should be a well-regulated institutional framework which will take care for these challenges to be surpassed easily, so we stay available for the regulators to assess the challenges together and to create strategical approach to overcome the situation faster, and with that to help the population to surpass this crisis period.

To summarize: Non-banking financial institutions are, and in the post-Covid period will continue to be crucial in meeting the population’s short-term financial needs, offering support to the clients for overcoming the economical crisis. From here, we expect that the situation for the industry in the next period will stabilize, but only with the support and promoting of the collaboration with the relevant organs and regulators.

  1. In your judgement, is there legal and business preconditions for the non-banking financial sector development in our country?

I would like to say that there are legal and business preconditions for the non-banking financial sector development, and if I lean on the recently published feasibility-study with results from the survey on the development of the Fintech sector in the country conducted by the National Bank, the answer will be that the overall sector for financial services in the Republic of North Macedonia is ready for the FinTech transformation. This claim is in our favor, but it is important to emphasize that Tigo, as a Fintech company, is practically founded digitally and our operations are fully in accordance with the new digital age and the new financial needs that are imposed. From here, I am really happy with the fact that the sector of the non-banking financial companies can be at the leader of that digital transformation in the financial system, which creates extremely beneficial business preconditions for development.

The crucial findings indicate that the need for development of the Fintech sector is justified, but also that further changes in the regulation are necessary to support the development of the Fintech industry. In fact, these necessary changes in the regulation are the biggest obstacle for the development of the sector, because that framework that will support innovative solutions, while undoubtedly taking into account the potential risks, is a precondition for industry development from a legal point of view and for modernization of the overall financial system.

The non-banking financial companies have an important role in the recovery of the whole economy, because they provide improvement of the purchasing power of the population and ensure financial inclusion of the unserved population. At the same time, although the total share of the sector may be small, it still employs thousands of people, and affects the overall socio-economic environment through its contribution to government duties that are not to be neglected, but also through community development projects. In other words, appropriate development of the FinTech industry is both in the interest of the citizens and in the interest of the economy, and these are factors that need to be seen by the regulators. It is necessary to improves the collaboration with the state organs, in order for the sector to be involved in the adoption of regulations for the development of the Fintech industry in the Republic of North Macedonia in long-terms.

From a business aspect, I believe that there are preconditions for development of the non-banking financial companies sector, as I mentioned, also because the non-banking financial companies enable approach to finance for citizens and small business that has difficulties for access to financial funds in another way. A beneficial business precondition should not exclude the fact that the Fintech industry opens up a huge potential to be a driver of the financial industry in the future, especially as the needs of customers for greater availability of financial services on digital channels in the digital age will grow, so the new Fintech conditions based on advanced technologies are in fact a response to the increasingly dynamic market, and from here, the non-banking financial companies, although are the youngest segment in the financial sector of North Macedonia, they are still the fastest growing segment which supports hundreds of thousands of citizens and small companies.