Speaker 1: Pushkin.
Speaker 2: By twenty twenty, Nina Mohunty had been working in fintech
Speaker 2: in financial technology for several years. She'd worked at MasterCard.
Speaker 2: At this point, she was working at Klarna, the buy now,
Speaker 2: pay later company, and she was working for them in London,
Speaker 2: and she started paying attention to what seemed like a
Speaker 2: big underserved market for financial technology immigrants. There were, of course,
Speaker 2: lots of tools for immigrants to send money home right,
Speaker 2: lots of tools for remittances, but it didn't seem like
Speaker 2: anyone was creating financial tools to help immigrants save money
Speaker 2: in the UK where they were for themselves.
Speaker 3: So I went down the rabbit hole and I spoke
Speaker 3: to anyone that was speak to me. People often say
Speaker 3: that I have the personality of a golden retriever. It
Speaker 3: just speaks to anyone. I was going up to people
Speaker 3: and saying, you know, bus drivers on their cigarette bricks
Speaker 3: and asking them how are you managing your money? And
Speaker 3: I was going to cleaners and offices, and I was
Speaker 3: going up to you know, nurses. I was literally someone
Speaker 3: was taking blood and I was asking them about how
Speaker 3: they're managing their money. And these all became translated over
Speaker 3: time into post it notes that started to populate my wall,
Speaker 3: and it very much looked like that meme from Always
Speaker 3: Sunny in Philadelphia where He's got the red string. And
Speaker 3: I remember one day waking up and just looking at
Speaker 3: this wall, and because I had just moved back to
Speaker 3: the UK, I didn't have anything on my walls. It
Speaker 3: was like a barely furnished flat and I didn't have
Speaker 3: room for art on my walls because it was covered
Speaker 3: in screenshots of apps that already exist out there and
Speaker 3: what I thought they were doing well. It had notes
Speaker 3: of you know, a quote that someone said to me
Speaker 3: when we were having a chat and about how they
Speaker 3: wish they could do xyz And so that was my
Speaker 3: decor and that was ultimately what pushed me to start
Speaker 3: my business Blue Money.
Speaker 2: I'm Jacob Goldstein and this is What's Your Problem, the
Speaker 2: show where I talk to people who are trying to
Speaker 2: make technological progress. My guest today is Nina Mohunti, the
Speaker 2: founder and CEO of Blue Money. As you'll hear, Nina
Speaker 2: wound up creating an app based on a savings and
Speaker 2: credit system that has been used around the world for
Speaker 2: a thousand years, literally a thousand years, And she told
Speaker 2: me she hopes to build on this thousand year old
Speaker 2: tradition to eventually create an international financial powerhouse.
Speaker 3: So the problem that I kept coming across is people
Speaker 3: that are new to a country find it very, very
Speaker 3: difficult to actually integrate into the financial system. And there's
Speaker 3: a number of reasons for this. People might struggle to
Speaker 3: get access to credit because they don't have a credit score,
Speaker 3: and especially in the US and increasingly in Europe, your
Speaker 3: credit score determines a lot about what you can do,
Speaker 3: oftentimes if you can rent a place from a private landlord,
Speaker 3: for example, where you can get a job, So these
Speaker 3: are all things that are really important. It affects your
Speaker 3: ability to get insurance, right and if you're driving, you
Speaker 3: need car insurance most places. And if the financial system
Speaker 3: doesn't know who you are, because there's no pay per
Speaker 3: trail of you in this country, you're basically invisible to
Speaker 3: the financial system. And that's what I kept hearing over
Speaker 3: and over and over when I spoke to folks, which
Speaker 3: was I'm here, I have a bank account, but I
Speaker 3: don't know what is available to me, and I struggle
Speaker 3: to access other financial products. Okay, and when I do,
Speaker 3: if I get to that stage where I know what
Speaker 3: I want. I want a car loan. I can't because
Speaker 3: I don't exist, I don't have a credit score. So
Speaker 3: I'm going to just have a someone say well, computer
Speaker 3: says no, there's no car loan available for you.
Speaker 2: So okay, So this is the landscape that you're walking into.
Speaker 2: What do you decide to do?
Speaker 3: Yes. One of the things that kept coming out of
Speaker 3: these conversations was the presence of informal financial systems. And
Speaker 3: this was really intriguing to me. I come from an
Speaker 3: immigrant background, and one of the behaviors that kept coming
Speaker 3: up was a behavior that I recognized actually, in which
Speaker 3: groups of people would come together and pull their funds,
Speaker 3: often with their own social group. So you know someone
Speaker 3: that they see at the market, or they live on
Speaker 3: the same council estate together, or they see each other
Speaker 3: at church or mosque, and they would come together and
Speaker 3: pull their money and kind of increase their affordability for
Speaker 3: one person at a time within that group.
Speaker 2: Let's talk about this in some detail, because this is
Speaker 2: a very specific thing. Right, it has an academic name. Right,
Speaker 2: it's called the Rotating Savings and Credit Association absolutely ROSCA
Speaker 2: to its friends. Yes, and like it's actually One of
Speaker 2: the most interesting things to me about what you are
Speaker 2: doing is that it is this thing that is like
Speaker 2: a thousand years old. Literally yes, So so tell me specifically,
Speaker 2: like how does erosca work? Right, old school before you
Speaker 2: come along, old school.
Speaker 3: The way that this is work, this would work is
Speaker 3: I'm going to give you the example of my grandma
Speaker 3: who used to do this in her village in India.
Speaker 2: But this is true story. This is a truth just
Speaker 2: so story. It's actually happening.
Speaker 3: This is actually happens. This is a true story. My
Speaker 3: grandmother lived in a small village and she would choose
Speaker 3: people from the village who she would see at market,
Speaker 3: who she would see at the temple, who she knew
Speaker 3: were trustworthy, to come together into this group. And she
Speaker 3: would determine a set sum of money. So to make
Speaker 3: the maths easy, let's say one hundred rupees, okay, and
Speaker 3: let's say there were ten women that were coming together.
Speaker 3: So these ten women would agree to put a hundred
Speaker 3: groupees into a pot every month. So my grandmother would
Speaker 3: go around and she would collect the one hundred rupees
Speaker 3: from all ten women, and that pot would suddenly have
Speaker 3: a thousand rupees in it and one woman would be
Speaker 3: given that one thousand rupees to have for the month,
Speaker 3: so they could spend it however they wished. They could
Speaker 3: buy a new sorry, they could you know, sacrifice something
Speaker 3: at the temple, they could put it towards their child's
Speaker 3: tuition for school, whatever they wanted to do with it.
Speaker 3: The next month, they would all come together, or rather
Speaker 3: my grandmother would go and seek them out and gather
Speaker 3: that one hundred rupees from each person until all ten
Speaker 3: had put one hundred rupees in, which meant there was
Speaker 3: a thousand rupees for the next person to use. And
Speaker 3: so every month that would rotate until each person over
Speaker 3: that ten month cycle had an opportunity to use that
Speaker 3: one thousand rupees. And what is so fascinating about this
Speaker 3: to me is it is something that I thought was Asian,
Speaker 3: because I'm half Indian half Taiwanese. We do this in
Speaker 3: Taiwan and in China as well. We call it hui
Speaker 3: which means association or hui kind of coming together in
Speaker 3: an association. But in India we call them chip funds
Speaker 3: or kiddies. So I thought it must be an Asian thing.
Speaker 3: And then I remember when I first moved here to
Speaker 3: working at the US Embassy in London. I met a
Speaker 3: Jamaican man. He said, Oh, we do something just like this,
Speaker 3: and we call it Pardna or Pardna hand. And then
Speaker 3: I spoke to my friend who's British Pakistani and she said,
Speaker 3: we do this too, we call it committee. And I thought, okay,
Speaker 3: well that's still asia interesting. Then I met someone who
Speaker 3: was Somali and she said, we do this too, we
Speaker 3: call it hegbud. And then I met someone who's Mexican
Speaker 3: and said, we do this too, we call it tanda.
Speaker 3: And so the more I sought it out, the more
Speaker 3: I realized that in the global majority, most of us
Speaker 3: are doing this, and we have been doing it for
Speaker 3: generations for a thousand years.
Speaker 2: Right, there's literally I saw a study that found evidence
Speaker 2: of this in like Song China, which is truly like
Speaker 2: a thousand years of mixture, one thousand, Right, So there
Speaker 2: is this interesting question of why, right, Like, this is
Speaker 2: a kind of technology. Right, it's like a bottom up
Speaker 2: financial technology that I think pretty clearly has been sort
Speaker 2: of independently invented in different places over time. Right, So, like,
Speaker 2: what is it about it that makes people keep figuring
Speaker 2: this out and keep doing it?
Speaker 3: So that is something that has plagued my mind for
Speaker 3: years now, not least because I'm building my business around it.
Speaker 3: But yeah, one of the things that I think about
Speaker 3: often is our different cultural attitudes towards money, but also
Speaker 3: just society in general. And there's a I believe he's Dutch,
Speaker 3: a man named Hirtz Hofstetter, and he had this framework,
Speaker 3: the hofstad Is framework of culture, and where every culture
Speaker 3: has a different flavor to it. Obviously, but some cultures
Speaker 3: are very individualistic and some cultures are very collective. And
Speaker 3: in the global South, in Asian countries, in African cultures,
Speaker 3: in Latin cultures, we tend to have more collective cultures,
Speaker 3: whereas in the West we are often more individualistic.
Speaker 2: So there's this broad context of like, okay, a more
Speaker 2: communal vibe leads you into this kind of thing. I mean,
Speaker 2: I could also imagine like it's a kind of savings, right, yeah,
Speaker 2: kind of savings. It's right there in the name. And
Speaker 2: you can think of a lot of places in the
Speaker 2: world where you cannot put your money in the bank,
Speaker 2: or if you could, your money might disappear, right, Like
Speaker 2: the idea that the that the bank is not going
Speaker 2: to go under and that if it does, there's a
Speaker 2: reliable government insurance. Yeah, which is in fact the case
Speaker 2: now in the US and much of the developed world,
Speaker 2: is obviously not the case for most of world history.
Speaker 2: So like that seems like quite a whatever, a less
Speaker 2: warm and fuzzy but also plausible virtue of the ROSCA.
Speaker 3: I absolutely think this. But if we really drill down,
Speaker 3: I mean, in the States, we have credit unions, right,
Speaker 3: or community banks and that sort of thing, and that's
Speaker 3: just a more macro version of a ROSCA, Right. It's
Speaker 3: a group of people coming together with some sort of affinity.
Speaker 3: We all live in the same area, or in Edinburgh,
Speaker 3: there's a lovely facade of what is now a clothing store,
Speaker 3: but it says the Laundry Workers Bank, and it was
Speaker 3: people who worked at the laundry together that came together
Speaker 3: to form effectively a community bank. And so it's something
Speaker 3: we've been doing but have lost sight of over time.
Speaker 3: But I definitely think that you're right that there's something
Speaker 3: in trust or the lack of trust, especially if you
Speaker 3: live in a country where maybe you do not trust
Speaker 3: financial institutions, you do not trust your government for whatever reason.
Speaker 3: I think that's probably why it's so prevalent in those areas,
Speaker 3: more so than it is in the West.
Speaker 2: Okay, so you discover the rosca and you're gonna and
Speaker 2: then what you're gonna build a rosca app I mean,
Speaker 2: that's basically the move at that point.
Speaker 3: What really intrigued me about the rosca and as someone
Speaker 3: who had seen it right with my own parents ing
Speaker 3: and my grandparents doing it, was one it exists in
Speaker 3: almost every culture, uh, non Western culture, I should specify.
Speaker 3: And what was interesting to me about that is, just
Speaker 3: like remittances and money transfer, it's something that every culture does, right.
Speaker 3: It doesn't matter if you're sending money from like my
Speaker 3: dad did, California to India, or to Pakistan or to
Speaker 3: wherever in the world to Mexico. People are sending money
Speaker 3: and so similarly, it was a behavior that was replicable
Speaker 3: across cultures. What was very interesting to me is everyone
Speaker 3: has their own name for it.
Speaker 2: Yeah, give me a list. You did a few, Like,
Speaker 2: how many can you give me? If you just go
Speaker 2: in one breath? Oh gosh, okay, on your marks, get
Speaker 2: set ready, go, We've.
Speaker 3: Got Tannine Mexico Consocio in Brazil. Partner or partner Han
Speaker 3: in Jamaica, money Box in Saint Lucia, hegbad Ayuto in Somalia,
Speaker 3: Ajo in Nigeria or is Susu depending on your tribek
Speaker 3: Limba in Congo, Tontine in any Francophone African country. We've
Speaker 3: got Committee in Bangladesh and Pakistan, panlu Wagan in Philippines,
Speaker 3: Aisan in Malaysia, Hui or Hue in China, and Taiwan
Speaker 3: Jungam in South Korea.
Speaker 2: The list goes on very good. And I can say
Speaker 2: I'm talking about video you were not reading now, you
Speaker 2: were looking like up at the ceiling. That was truly
Speaker 2: off the top.
Speaker 3: Yes, off the top of my head. It's my party
Speaker 3: trick now, So I mean people will be like, I'm
Speaker 3: from here, what is it called? And I have to
Speaker 3: try and figure it out. And then more importantly, and
Speaker 3: going back to the original problem that we were discussing,
Speaker 3: is people are moving huge sums of money. Depending on
Speaker 3: who you speak to, there's one startup that's done the
Speaker 3: math and they think globally there's three hundred billion dollars
Speaker 3: moving through Rosco's globally. But it's something that people take
Speaker 3: with them, especially immigrant communities when they move to a
Speaker 3: new place. Because they are new, they know their community.
Speaker 3: They seek out their community first, they might join the
Speaker 3: community circle or club as we might call it. And
Speaker 3: what is fascinating and so valuable about this is if
Speaker 3: someone is putting in one hundred dollars or one hundred
Speaker 3: pounds or one hundred euros every month and they're paying
Speaker 3: in on time, that's actually really great financial behavior. Right.
Speaker 3: It tells me you're good for the money.
Speaker 2: Yes, that that's that's a good credit right. I mean fundamentally,
Speaker 2: you you select people. When your grandmother was doing this
Speaker 2: choosing people for her club, she had a credit score
Speaker 2: in her mind, right, Like exactly, you are. You are
Speaker 2: just reducing trust to the neighborhood. You're not going to
Speaker 2: invite somebody who's gonna get a thousand bucks right now
Speaker 2: and pay you back a thousand bucks over the next year.
Speaker 2: You're not going to invite them if they are sketchy.
Speaker 3: No. Absolutely, And and some of my favorite interactions I
Speaker 3: speak French, and so where I live in London is
Speaker 3: called Lewisham and there's a lot of West African folks here,
Speaker 3: a lot of Francophone West Africans, and there's a hair
Speaker 3: salon where I go to get my eyebrows done. There's
Speaker 3: a lovely Sri Lankan woman that does that. But there
Speaker 3: are these Ivorian women doing braiding hair and I started
Speaker 3: speaking to them about it, and they're speaking in French,
Speaker 3: and I don't think they realize that I speak French.
Speaker 3: And they were basically just talking shit about the various people.
Speaker 3: And they're like, we don't like so and so she
Speaker 3: never pays in on time, she's not allowed into are
Speaker 3: tol tine as they call it in Francophone Africa, and
Speaker 3: so people are underwriting their community.
Speaker 2: That credit score, gossip at the salon.
Speaker 3: It's the original, and it's like, we know that she
Speaker 3: doesn't pay on time, she doesn't go to church, she's
Speaker 3: not going to be there whatever. But these are things
Speaker 3: that people have been using to underwrite each other for
Speaker 3: thousand years plus.
Speaker 2: Right, So okay, well you've got the thousand years. It's
Speaker 2: time for you to start your company in this narrative. Now,
Speaker 2: how do you start a company, you know, around this idea,
Speaker 2: around this practice.
Speaker 3: Not easily, I'll tell you that much. I think the
Speaker 3: interesting thing is I have worked in the fintech industry
Speaker 3: financial technology for so long now, and it never occurred
Speaker 3: to me that I would be a founder myself or
Speaker 3: the entrepreneur in charge. I'm very good at building things,
Speaker 3: and I've got a lot of pleasure out of building
Speaker 3: interesting products. And so I built a no code app
Speaker 3: and I said, let's just see if this thing works.
Speaker 3: And so I invited fifty women. I do a lot
Speaker 3: of work with various migrant groups and specifically women, and
Speaker 3: invited them to try this web app. And what we
Speaker 3: found was there was one hundred percent payment right. Everyone
Speaker 3: paid on time, and people said to us, this is great.
Speaker 3: I didn't have to go get cash out. I didn't
Speaker 3: have to send my child with the cash down to
Speaker 3: the auntie's house for collection. It was great, like it
Speaker 3: was collected and it was sent out to me when
Speaker 3: it was time to receive the money. And so now
Speaker 3: what do I do, because I have to go and
Speaker 3: get regulated. I can't just be, you know, moving large
Speaker 3: sums of money around and not be regulated. And so
Speaker 3: I started the process of explaining to the Financial Conduct
Speaker 3: Authority what EROSCA is and why it exists. And that
Speaker 3: was actually very very challenging because there aren't many people
Speaker 3: that looked like me that work in the Innovation Department
Speaker 3: of the FCA, right, And if you're you know, a
Speaker 3: native born, white British person, perhaps you've never come across
Speaker 3: this before and you don't understand why anyone would engage
Speaker 3: in this, and you start to ask questions like, well,
Speaker 3: it feels a little bit like peer to peer lending,
Speaker 3: where it feels a little bit like crowdfunding.
Speaker 2: So it does feel a little bit like peer to
Speaker 2: peer lending. That is not an That is not an
Speaker 2: unreasonable thought, it's not at all.
Speaker 3: And even even crowdfunding, you could argue that, yeah, actually,
Speaker 3: in a way, it is crowdfunding and it rotates fine.
Speaker 3: So we really had to make the case that this
Speaker 3: is neither peer to peer lending nor crowdfunding, but its
Speaker 3: own special thing. Then I had to go and face
Speaker 3: the venture capital industry, and that was probably the most
Speaker 3: daunting thing I've ever done to this day. Still. I'm
Speaker 3: from the Silicon Valley, and you know, I grew down
Speaker 3: the street from Apple and you know there, I mean,
Speaker 3: venture capital firms are a dime a dozen in the
Speaker 3: Silicon Valley. But it's very different just driving past and
Speaker 3: then going into actually pitch to these folks to say
Speaker 3: here's this problem that I want to solve, here's why
Speaker 3: I want to do it, and here's why you should
Speaker 3: give me a million pounds to do it. Right. But
Speaker 3: I did that and it was very very daunting, very
Speaker 3: very difficult. But it was one of those things where
Speaker 3: I wouldn't be able to bootstrap, as we say, kind
Speaker 3: of use my own money to fund this business, because
Speaker 3: of course we're building a tech product and it's regulated
Speaker 3: and so it just requires a little bit more of
Speaker 3: that upfront investment. And then from there we were off
Speaker 3: to the races.
Speaker 1: We'll be back in just a minute.
Speaker 2: So how does it work? What's the thing you have now?
Speaker 2: And how does it work?
Speaker 3: Yeah, So the Bloom app is pretty straightforward. It's an
Speaker 3: app where you download it, you register, you go through
Speaker 3: Know your Customer or KYC, so we ask you for
Speaker 3: a selfie and a picture of your ID, and from
Speaker 3: there we do all these checks in the background, make
Speaker 3: sure you are who you say you are, and then
Speaker 3: you go to the homepage and you're able to either
Speaker 3: create a circle, so we call them Bloom circles to
Speaker 3: homogenize the name across cultures. You can either create your
Speaker 3: own circle and choose how much you want to put
Speaker 3: in how often, so you can do it weekly, bi
Speaker 3: weekly or monthly, although monthly is the most popular cadence.
Speaker 3: You choose how much, how many people, and then your
Speaker 3: start date and from there you can share your circle
Speaker 3: and say here's the code, join my circle and in
Speaker 3: a private circle. That means you are in full control.
Speaker 3: And this is the most faithful reproduction I guess of
Speaker 3: what we have done for a thousand years. So it
Speaker 3: can be my friends and family, it can be the
Speaker 3: people at the mosque, whoever, right.
Speaker 2: So in this case, this is just replacing like having
Speaker 2: to take cash to whoever every month, correct with an
Speaker 2: automated system. And so how does the money actually flow?
Speaker 2: Like does everybody have to have a bank account? Are
Speaker 2: you a bank?
Speaker 3: So everyone has to have their own UK based bank
Speaker 3: account because we're based in the UK. And then they
Speaker 3: have to have a UK issue debit card, so we
Speaker 3: don't let people use credit for this particular financial activity.
Speaker 3: But what they do is they connect their debit card
Speaker 3: and the money is automatic collected on the set date
Speaker 3: each month or whatever the cadence is, and then we
Speaker 3: take your bank details and when it's your turn to
Speaker 3: receive your payout. We send that straight into your bank account.
Speaker 2: So a lot of you're basically the rails.
Speaker 3: You're the pipe exactly. We are the pipes. We orchestrate
Speaker 3: the payments for you and take that stress out of
Speaker 3: you know, following up and trying to figure out where
Speaker 3: is the money and someone says, oh, I need to
Speaker 3: get cash out or all those drama.
Speaker 2: That comes with that, and what do you charge?
Speaker 3: So we try a transaction fee of four percent and
Speaker 3: that allows us to safely process and manage your account
Speaker 3: with a little bit of margin for us to be
Speaker 3: able to put back into our business of course. But
Speaker 3: what is really interesting is when you're in the Bloom circles,
Speaker 3: you have the option to do a private circle, but
Speaker 3: most of our volume is actually through what we call
Speaker 3: community or public circles. And this is where people will
Speaker 3: join fleet strangers in a circle. And that has been
Speaker 3: fascinating to me because as someone that.
Speaker 2: Is wild, that's most of your business.
Speaker 3: I would say ninety five percent of our circles are
Speaker 3: pure strangers coming together in circles.
Speaker 2: Is it like a well, what happens if somebody gets
Speaker 2: all the money the first month and then bails and that.
Speaker 3: Is exactly it. So we have had bad actors. But
Speaker 3: you know what is fascinating is we've had people take
Speaker 3: the money and then run, and in this instance that
Speaker 3: will mean they'll stop topping up their account, or they'll
Speaker 3: cancel their card or whatever. But what is very fascinating
Speaker 3: is the people that have cut and run end up
Speaker 3: coming back and we've been made whole. They have paid
Speaker 3: us back for that money because they realize if they
Speaker 3: want to join a subsequent circle, there's no way that
Speaker 3: we're going to let them onto our platform because they
Speaker 3: screwed everyone else over.
Speaker 2: I mean I wouldn't let them back even if they asked,
Speaker 2: if they cut it round and then said can I
Speaker 2: come back? I don't think you should say yes.
Speaker 3: So we've not let anyone back in what we have
Speaker 3: a rehabilitation program where people can start to like pay
Speaker 3: back smaller sums because there.
Speaker 2: Is or you can let them join, but they're the
Speaker 2: ones who get paid last in the cycle. I guess
Speaker 2: that's insurance. Wait, let me ask just to be clear, like,
Speaker 2: is there any kind of insurance Like if somebody takes
Speaker 2: all the money the first month and then splits, are
Speaker 2: the other people in the circle just screwed or is
Speaker 2: there some kind of insurance present.
Speaker 3: We don't have insurance. And we make that very clear with.
Speaker 2: Is it a contract, like is the person committing fraud
Speaker 2: or anything if they take the money and bail, are
Speaker 2: they just a bad person?
Speaker 3: So well, both there is a contract and so they
Speaker 3: actually have to sign it. And that has really come
Speaker 3: in handy and it says a lot about signatures in
Speaker 3: today's digital world to me.
Speaker 2: Because people think it means something even though it actually doesn't.
Speaker 2: Is that the secret of the contract, It truly is.
Speaker 3: Because first we tried doing biometrics, so people would do
Speaker 3: a selfie or you know, use face ID, or they
Speaker 3: would do their touch, you know, thumbprint, and they would say, oh, well,
Speaker 3: I didn't sign anything. That's not me signing, even though
Speaker 3: they've used their biometric And so we actually have a
Speaker 3: step now where you have to sign with your finger.
Speaker 3: You're a signature like on your phone phone And it
Speaker 3: has really changed people's perception of like, oh, I am
Speaker 3: actually entering into an agreement now and I'm going to
Speaker 3: pay this money in And so we do not make
Speaker 3: people whole, and we make that very clearer in our
Speaker 3: terms and conditions when people are joining circles, and yet
Speaker 3: we have a ninety eight percent payment rate, and so
Speaker 3: very rarely are people cutting and running, and even if
Speaker 3: they do, they tend to come back and kind of
Speaker 3: feel guilty about it. And I think that says something
Speaker 3: about this social cohesion, right.
Speaker 2: Yeah, And just to be clear, this is people who
Speaker 2: are just randomly assigned to a circle.
Speaker 3: Correct.
Speaker 2: They don't know the other people, they're not from the
Speaker 2: same community, they don't live in the same neighborhood, whatever, exactly.
Speaker 2: That's really interesting. I guess it's hardening in a way.
Speaker 2: I think I would have predicted worse behavior. Yeah, I
Speaker 2: think that's good news, right in.
Speaker 3: Today's society where you're you're very skeptical of humanity and
Speaker 3: and you're looking for the good but expecting the worst, perhaps.
Speaker 2: Especially in a you know, anonymized, distant, digitized way exactly.
Speaker 3: And I think though, one of the things that kind
Speaker 3: of helps us is we both we have a care
Speaker 3: and a stick. So what we've been doing is actually
Speaker 3: taking this data that we were collecting. Let's see that you,
Speaker 3: Jacob have paid in every month on time. We are
Speaker 3: building our own underwriting algorithm and saying Jacob's good for
Speaker 3: the money. This is fantastic so that we can eventually
Speaker 3: go into lending and say, uh huh, hey, Jacob, you've
Speaker 3: got a perfect bloom credit score. We're going to lend
Speaker 3: to you now.
Speaker 2: In the way that so far started out doing just
Speaker 2: this very narrow like, oh, we'll lend money from alumni
Speaker 2: to college students. And now they're just like a giant
Speaker 2: financial institution. You're that, but for immigrants exactly that.
Speaker 3: And so what we keep seeing is that people want
Speaker 3: to have a good record.
Speaker 2: Uh huh, you're their credit score. You're the immigrant credits.
Speaker 3: We're the immigrant credit score. And we have the largest
Speaker 3: data set in the UK on immigrant communities and their
Speaker 3: financial behavior at present.
Speaker 2: How big is it? How big is it?
Speaker 3: So we're still tiny, We're thirteen thousand customers. We're very
Speaker 3: very early stage. But the very interesting thing is no
Speaker 3: one else has thought to do this before.
Speaker 2: And by the way, how many people do you reject
Speaker 2: up front? How much of your you know, high payment
Speaker 2: rate comes from figuring out beforehand who do not let in?
Speaker 3: Usually they wouldn't even have made it to be able
Speaker 3: to join a circle. Like if there's someone that has
Speaker 3: fraudulent behavior, all of those backend checks that we do
Speaker 3: to make sure you are who you say you are
Speaker 3: will usually have already declined to even offer you an
Speaker 3: account in the first place.
Speaker 2: How often does that happen?
Speaker 3: Maybe one percent of the time. I mean that is
Speaker 3: the beauty of kind of I think we are that
Speaker 3: bridge from the informal financial system into the formal financial
Speaker 3: system because we can kind of take all of this
Speaker 3: other data access around us, and you know, you might
Speaker 3: have a record good or bad elsewhere, but we can
Speaker 3: connect those dots and then ultimately our goal is to
Speaker 3: work with you know, the transunions, the experience the echo
Speaker 3: fax is to actually help people build their credit scores
Speaker 3: using bloom circles. Though it's not actually a credit product,
Speaker 3: is a behavior that people are already doing and we're
Speaker 3: just formalizing it and digitizing it, and so it's something
Speaker 3: that longer term will actually show us more valuable insights
Speaker 3: into the financial behavior of our customers.
Speaker 2: What was something you tried that didn't work.
Speaker 3: I'll be honest, it's the private circles. When we first launched,
Speaker 3: we launched with private circles, and you know, in the
Speaker 3: startup land, they say build it and they will come
Speaker 3: so I was like, great, here it is the apps
Speaker 3: out were regulated, let's go, and no one was transacting.
Speaker 3: It was I felt like I was running into a
Speaker 3: brick wall, like, come on, why isn't anyone moving money?
Speaker 3: Build it and they will come. And they were creating accounts,
Speaker 3: and they were registering and connecting their debit cards, but
Speaker 3: they weren't joining or creating circles. And I started to
Speaker 3: speak to people and just call customers up or email
Speaker 3: them and say, you know, we see you've registered. What's
Speaker 3: keeping you from going the next step and actually joining
Speaker 3: a circle. And we heard a lot of excuses. We
Speaker 3: heard I'm in the circle right now, and it you know,
Speaker 3: it's a cash one and it will end in a
Speaker 3: few months and I'll join a bloom one then, or
Speaker 3: I'm going to join a bloom one at the start
Speaker 3: of the year, because I always do one at the
Speaker 3: beginning of the year, So some of it was timing.
Speaker 3: But the most common response that we got was I
Speaker 3: don't have enough friends.
Speaker 2: Huh.
Speaker 3: And that was so so interesting to me because I
Speaker 3: pushed them on that what does that mean? What do
Speaker 3: you mean you don't have enough friends? And what they
Speaker 3: meant is I don't have enough people that can match
Speaker 3: the financial obligation of what I want to put in
Speaker 3: to my circle. So they might say, you know, I
Speaker 3: want to put one hundred pounds a month in, but
Speaker 3: my sister can only afford to do fifty. That's not
Speaker 3: enough for me. I want to be able to do
Speaker 3: it with six people and have six hundred pounds at
Speaker 3: the end of it to make it really worth my while, right,
Speaker 3: instead of maybe three hundred pounds. And I kept hearing
Speaker 3: this over and over and over. I heard a lot
Speaker 3: of people say, I don't want to be in a
Speaker 3: circle with my friends and family because I don't want
Speaker 3: them to know.
Speaker 2: Yeah, oh, yeah, right, I don't want them to know.
Speaker 2: That's interesting, and it was fascinating. I don't want them
Speaker 2: to know that I'm going to get one thousand pounds
Speaker 2: one month, because that'll exactly And.
Speaker 3: One of our team members, Asha, she comes from an
Speaker 3: usher Yemeny family, and she was joking like, I don't
Speaker 3: want them knowing my business because you know, if they
Speaker 3: know how much disposable income I have, they're going to
Speaker 3: pressure me to send more money home. And that was
Speaker 3: fascinating to me.
Speaker 2: It's kind of that's really interesting. Some of it was
Speaker 2: just my anonymized finess finance. Right, this is like, no, no,
Speaker 2: I don't want community, I just want findance.
Speaker 3: I just want finance. I want culturally resonant. And I
Speaker 3: you know, it's something we understand and the behavior is done.
Speaker 2: But I actually but it is kind of an anti
Speaker 2: communal vibe. Right, It's like, I want my business to
Speaker 2: be my business.
Speaker 3: Paradoxically exactly that, And nowadays it's fascinating people that join
Speaker 3: public circles. Oftentimes we have one person that will then
Speaker 3: start and they'll become a node and create their private
Speaker 3: circle and bring in their group of family. And that
Speaker 3: tells us that that person probably was seeing if they
Speaker 3: could trust us and if the money was going to
Speaker 3: end up where it was supposed to before bringing in
Speaker 3: their social group. So it was one of those things
Speaker 3: where we launched with it and yeah, it's it didn't
Speaker 3: just go gangbusters, but it's it taught us a lot
Speaker 3: about the underlying behavior of our community. One of the
Speaker 3: things that we found over and over again when we
Speaker 3: spoke to customers is Okay, I have this money now
Speaker 3: and I don't know what to do with it, so
Speaker 3: I end up sending more home and it ends up
Speaker 3: being like a bonus for everyone back home, or I
Speaker 3: end up buying something that ends up being useless and
Speaker 3: not something that I actually need, and it's a waste
Speaker 3: of money. So I want to know where I should
Speaker 3: put this money. And so now with technology, what we
Speaker 3: can do is say, hey, Jacob, you received five hundred pounds,
Speaker 3: why don't you put half of that into a money
Speaker 3: market fund and actually grow your money? Why don't you
Speaker 3: put it into a pension pot and again have your
Speaker 3: money work for you.
Speaker 2: And the people are right there in your app when
Speaker 2: they get the money right like that.
Speaker 3: And so now we can just direct that flow of
Speaker 3: funds and say, yeah, put it in this money market fund. Great. Yes,
Speaker 3: of course they're socioeconomic and geopolitical differences between us. But
Speaker 3: can we actually get people to have access to financial
Speaker 3: products and serve them to them at the right time
Speaker 3: in a culturally relevant way and help them build financial
Speaker 3: resilience and wealth for themselves wherever their new home is.
Speaker 3: That's ultimately what we're driving towards.
Speaker 2: Not to be crass after that high minded idea, which
Speaker 2: I am a fan of, but like in that universe,
Speaker 2: do you get essentially a commission from whatever money market
Speaker 2: fund you're sending the people to, like, what's the business
Speaker 2: model for that time?
Speaker 3: Yeah, exactly, So would be very much like your Betterments
Speaker 3: of the world, where you charge a management fee of
Speaker 3: some sort and then we would just take that percentage
Speaker 3: off the assets of your management.
Speaker 2: So in that universe, they're like coming to the blue
Speaker 2: map to look at their money market fund exactly, and
Speaker 2: you're not the money market fund, but you're where they
Speaker 2: sort of.
Speaker 3: Deal with exactly, and we ultimately, over time, as we
Speaker 3: grow as a business, become that financial headquarters. But through
Speaker 3: the lens of people who live a diaspora lifestyle where
Speaker 3: it's we get it. You're gonna have to send money home.
Speaker 3: That's great, but why don't you also put some aside
Speaker 3: for you or down the line. You know, my dad
Speaker 3: bought a plot of land in India and built a
Speaker 3: house for my late grandparents and his siblings. It's very
Speaker 3: common for people from immigrant backgrounds to buy a plot
Speaker 3: of land, build a house and that sort of thing. Well,
Speaker 3: imagine a world where at Bloom you can also like
Speaker 3: manage the flow of your funds so that the builders
Speaker 3: get paid and everything, and you know, you have the
Speaker 3: money to a mortgage to buy that plot of land, right,
Speaker 3: And there's so many different directions that these things can
Speaker 3: go where it's very specific to straddling countries, if not continents, right,
Speaker 3: But being of diaspora means that you are often one
Speaker 3: foot on one continent and one foot on the other.
Speaker 3: And so where the place that they can come? And
Speaker 3: that's that's the grand vision.
Speaker 2: Are you going to come to the US?
Speaker 3: I mean I am coming to the US. I'm an
Speaker 3: American citizen. Bloom It's an interesting one. Bloom money is
Speaker 3: serving immigrants, and of course the United States is the
Speaker 3: largest market for that to be a success. I think
Speaker 3: what I find exciting about Europe is that we are
Speaker 3: largely becoming a region of immigration across the European continent.
Speaker 3: And it's something that people don't realize, or they do
Speaker 3: through a political lens, but not through a financial services lens,
Speaker 3: and so there's a huge opportunity. Whereas in the States
Speaker 3: it's kind of written on the tin that we're a
Speaker 3: country of immigrants, like that's literally how we started. And
Speaker 3: so it's a bit more of an obvious problem, which
Speaker 3: means there's a lot more players in this. No one's
Speaker 3: doing exactly what we're doing, but there's a lot more folks,
Speaker 3: you know, specifically serving Latinos, right, So does.
Speaker 2: That mean you're going to Europe next?
Speaker 3: That is the plan, and I think, you know, be
Speaker 3: a country like France or maybe Germany where you have
Speaker 3: really large captive audiences, whether it's Turkish and Syrian in
Speaker 3: Germany or Francophone African in France. So watch this space.
Speaker 2: We'll be back in a minute with the lightning round.
Speaker 2: Let's finish with the lightning round. Okay, Oh gosh. If
Speaker 2: you could join a money club with any three people
Speaker 2: living or dead, who would they be?
Speaker 3: I would join with Hmmm, I would join with Emmeline Pankhurst.
Speaker 3: We love a suffragette queen. I would join with Benezir
Speaker 3: Bhutto in the ra Gandhi. And there's me, so maybe
Speaker 3: I'll add one more. Uh.
Speaker 2: These are political political leaders.
Speaker 3: Who happen to be and Mohammad Yunis, who is, like
Speaker 3: I guess, the interim leader of Bangladesh right now, but
Speaker 3: he was the founder of the Grimen Bank in Bangladesh
Speaker 3: and has very much experimented with roscas and how they
Speaker 3: can be used in developing countries. So yeah, those would
Speaker 3: be my few people.
Speaker 2: I feel like those people would all be good for it.
Speaker 3: Yeah, I feel like they'd be good for the money
Speaker 3: as well. Although Emily Pankhurst, I don't know, she got up.
Speaker 3: She was, you know, pamphleting. Women weren't allowed to have
Speaker 3: pockets because we would give pamphlets out, you know, about
Speaker 3: stuff for dead.
Speaker 2: It's amazing how many women's pants still do not have pockets.
Speaker 2: It's shocking to me.
Speaker 3: It is actually shocking, and I it's actually one of
Speaker 3: the things that I look for from a fashion perspective
Speaker 3: when I buy dresses even I'm like, yes, pockets.
Speaker 2: Pockets, it's a useful technology. Pocket everybody, what's one thing
Speaker 2: written on a post it note in front of you
Speaker 2: right now?
Speaker 3: Slow it down, Calm it down, pressure brakes and that's good. Yeah,
Speaker 3: that's just a reminder for me to not just speak
Speaker 3: too quickly when I'm actually speaking to people. But also
Speaker 3: just the course of business, like, applying pressure through speed
Speaker 3: doesn't always help things, and sometimes it breaks things and
Speaker 3: keeps a deal from happening because people feel pressured. So
Speaker 3: slow it down, calm it down.
Speaker 2: It's funny. I was thinking it was going to be
Speaker 2: like make dentist appointment.
Speaker 3: I mean, I've got those too, but they're far less
Speaker 3: they're far less deep. Jacob, I need you to, I
Speaker 3: need you to.
Speaker 2: Yes. How did your parents talk about money when you
Speaker 2: were a kid?
Speaker 3: Definitely from a scarcity mindset. We were a family that
Speaker 3: my father would like keep plastic bags and we very
Speaker 3: much would like you know, back in the nineties when
Speaker 3: they use proper plastic for ice cream tubs, like those
Speaker 3: would become tupperware for us to use until that thing
Speaker 3: broke down. But I think it was always a scarcity
Speaker 3: minds that there's never enough, and everything was about scrimping
Speaker 3: and saving. And my prom dress was thirty dollars from
Speaker 3: like I think it was rass or Marshals, and you
Speaker 3: know it was. I was always just taught that there
Speaker 3: was never enough, and that has unfortunately affected me as
Speaker 3: an adult because what is enough and what is enough
Speaker 3: in your emergency fund? What is enough to have in savings?
Speaker 3: What is enough to have in your investment account? And
Speaker 3: it becomes very difficult when you're trying to enjoy life
Speaker 3: as well.
Speaker 2: Can you just go out to dinner and not worry
Speaker 2: about it? Can you just order the fucking app.
Speaker 3: Yeah, just get the fucking latte, you know, like it's
Speaker 3: okay exactly.
Speaker 2: Yeah, yeah, I mean I don't want to stereotype, but
Speaker 2: I do feel like it's a classic immigrant vibe. Like
Speaker 2: my grandfather was an immigrant, and that's how I always yeah,
Speaker 2: that's how I came to understand that vibe. Yes, like
Speaker 2: it's just people for a thousand years didn't have enough,
Speaker 2: and so being in this world where it's like we're
Speaker 2: doing great, that's not natural. No family.
Speaker 3: I think it's something that to this day, my dad refuses.
Speaker 3: Our garage at home is full of just like crap
Speaker 3: that doesn't work.
Speaker 2: Yeah, I have a box of cords that i'd like
Speaker 2: to show you.
Speaker 3: And my dad he's got this one vacuum cleaner that
Speaker 3: he bought from Costco. This thing caught like probably weighs
Speaker 3: more than I do. And he refuses. I was like,
Speaker 3: I'm taking this to the dump, like, no one is
Speaker 3: gonna buy this. He's like, no, I'm selling it for
Speaker 3: two thousand dollars. I said, Dad, you bought it for
Speaker 3: two thousand dollars from Costco and this thing doesn't even work.
Speaker 3: You've got a Dyson, what are you doing? But it
Speaker 3: really like this hoarding mentality when you felt like you
Speaker 3: never had enough, it really sticks with you. So I'm
Speaker 3: trying to break the cycle now and hope hopefully I
Speaker 3: won't pass it down to any few your children I
Speaker 3: may have.
Speaker 2: Yeah, it's complicated though, because like I sort of like it, Yeah,
Speaker 2: at some level, you know what I mean. Like it's
Speaker 2: a balance, right obviously, Like people do spend all their money? Yeah,
Speaker 2: people do, you know, live beyond their means, and so you.
Speaker 3: Can it's in your head.
Speaker 2: Is hard, Equanimity is exactly everything.
Speaker 3: Moderation. There we go.
Speaker 2: Ninamo Hunty is the founder and CEO of Blue Money.
Speaker 2: Just a quick note, Whats Your Problem is gonna take
Speaker 2: a break for the next couple of weeks and then
Speaker 2: we'll be back with more episodes of the show. Please
Speaker 2: email us at problem at pushkin dot fm. We are
Speaker 2: always looking for new guests for the show. Today's show
Speaker 2: was produced by Trinamanino and Gabriel Hunter Chang, who was
Speaker 2: edited by Alexander Garretson and engineered by Sarah mcgharrett. I'm
Speaker 2: Jacob Goldstein and we'll be back next week with another
Speaker 2: episode of What's Your Problem.
Speaker 3: U