FinTech for financial inclusion

MASSIF investment: USD 500,000
Contracted: February 2018
Instrument: Convertible Loan

Founded in 2015, liwwa Inc. (liwwa) is a FinTech start-up that uses a hybrid marketplace and balance sheet lending platform to provide finance to un(der)served micro, small and medium-sized enterprises (MSMEs). MSMEs benefit from an online loan application process and marketplace function, where retail investors can crowdfund ‘investment campaigns’ alongside five local banks and liwwa. Moreover, liwwa aims to scale up its business in Jordan and intends to replicate the business in Egypt.

FMO's USD 500,000 convertible loan, with an option to convert to equity, has been used to invest in technology, fuel growth in Jordan and to lay the groundwork for liwwa in Egypt.

Realized impact of liwwa


By targeting MSMEs in both growing and financially underserved areas, liwwa supports job creation where it matters most. Increasing the financial inclusion of MSMEs is important, because they are the backbone of the Jordanian economy. No less than 98% of all operational companies in Jordan are SMEs and they account for approx. 40% of GDP. Moreover, SMEs employ about 71% of workers in Jordan.

In Jordan, enterprises are considered small when they employ five to 19 employees and medium-sized when they employ 20 to 99 employees. According to a 2015 report by the European Bank for Reconstruction and Development, around 70% of SMEs in Jordan are credit constrained, compared to only around 20% of large enterprises. SMEs are thus clearly underserved in the Jordanian financial sector. Additionally, the overall unemployment rate (14.9% in 2017) is high compared to the average of other countries in the MENA region (11.9% in 2017; excluding high-income countries like Saudi Arabia). This applies even more to youth unemployment, which is approx. 40% in Jordan and averages 29% for other countries in the MENA region (excl. high-income countries).

As of December 2018, liwwa has 297 clients, approximately half of which are small or micro (employing up to four people) enterprises. The loans liwwa has provided to its clients have contributed to the creation of 939 jobs, USD 3.6 mln of income and USD 25.6 mln in additional goods and services sold in the Jordanian economy up to the end of December 2018, according to Liwwa’s internal impact model.

Especially for a rapidly growing company like liwwa, the timing of investments is important in order to keep pace with the growth of the company. MASSIF’s investment acts as an important bridge between liwwa’s first round of funding and a planned second round.

The main source of impact risk for liwwa is that of business failure. As a start-up, risk of business failure is considered high. This risk is partially offset by the strong operational and strategic involvement of a venture capital investor with roots in the region. As with most economic models, there is a risk that liwwa’s impact model does not truly reflect its impact but the company works continuously to collect updated figures to enhance the accuracy of its assessment.