Digital Lending Technology Case Study

The client: Carilend

Institutional and retail online lending in the Caribbean

Point-of-Sale/Buy Now Pay Later loans

Employee loans - salary deducted lending

Multi-country, multi-company, multi-currency, and multi-lingual lending

Madiston was approached by Barbados based banking entrepreneur, Mark Young, who was looking for a technology partner to support his plans for a new Peer to Peer Lending business for the Caribbean, starting in Barbados. Seeing billions sitting idle in commercial banks across the Caribbean, Mark knew that there was an opportunity to drive greater economic growth in the region, by enabling investors to earn higher returns and borrowers to access credit more conveniently.

Mark Young, CEO, Carilend

The Need

The initial requirement was for digital consumer lending, but Mark wanted to grow his business quickly, offering new services and expanding into neighbouring countries. The technology partner and software he selected had to be capable of keeping up with his business plan.

The Solution

After discussions and demonstrations, the Madiston Platform clearly satisfied the technology requirements of Mark’s new business, Carilend. In addition to the comprehensive functionality, four key factors gave Mark and his team the confidence that they were making the right software choice:

• Localised  – The software had to work with the local facilities in various countries, for example, lending protocols, currencies, interest rates, KYC, ID, AML, credit reference, banking and payments.
• Opportunity to evolve the business model  – the flexibility that the Madiston Platform offered meant that changes could be made easily as the new business evolved.
• Extensive automation  – unprecedented levels of automation in the Madiston Platform meant that headcount could be kept to a minimum saving operational costs in the Carilend budget.
• Regulatory experience  – Whilst there was no formal regulation for Peer to Peer Lending in Barbados, Mark wanted to operate Carilend in line with the high standards set by the Financial Conduct Authority’s (FCA) regulation in the UK. The fact that the Madiston team were experienced in and had built the system to satisfy FCA regulations (and acquired FCA authorisation for their own P2P site in UK) meant that Carilend could tap into Madiston’s experience and adopt high standards from the outset.

And so the implementation of the system began for the new “Carilend” business.

Mark Young, CEO, Carilend

The Outcome

Using the Madiston Platform, Carilend became the first Peer to Peer Lender in the Caribbean. In the four years since launch, they have processed USD $24.2 million in value terms and over 2500 borrower loans, generating an average return of 8.3% after defaults, for their lenders.

Their rapid growth attracted the attention of the Victoria Mutual Building Society Group from Jamaica who saw real potential, becoming a strategic investor in the expanding Carilend group. In 2019, Carilend expanded into Jamaica, partnering with the VM Group and, in 2022, added Trinidad & Tobago alongside Massy Finance.

Mark Young acknowledged the role that Madiston had played in their growth, citing some of their major objectives and how the Madiston team and its online direct lending technology platform helped to achieve them:

• Staying ahead  – Starting small in Barbados, Carilend quickly expanded their services on the Platform, adding Salary Deducted Loans to bring the region’s employers into the process, giving borrowers the opportunity to secure the best rates. More recently, with the involvement of Victoria Mutual and Massy Finance, Carilend has added institutional balance sheet lending to its investment strategies. New Point-of-Sale “Buy Now, Pay Later” functionality has been deployed in its technology platform too, with more innovations in the pipeline.
• Geographical expansion  – So far, Carilend has already expanded into Jamaica and Trinidad & Tobago using a multi-country, multi-company multi-currency (and multi-lingual) version of Madiston’s software. They plan to extend this to other Caribbean countries and beyond. With the flexibility inherent within The Madiston Platform’s settings, this international expansion could be managed within one back office system, saving time and resources.
• Shaping the industry  – With the knowledge of the UK FCA regulation, Madiston helped Carilend evolve its business model. So, from the outset, the Carilend team has been instrumental in working with Barbadian Government and the banking sector, to ensure the industry adopts high standards of compliance to encourage growth and protect lenders and borrowers alike.
• Quality service  – the Madiston Platform was deployed with customised, highly automated processes that enabled consistent, compliance from customer on-boarding through credit risk categorisation, loan origination, account management, payments, banking, funds matching and all loan lifecycle servicing. The software carried the heavy load as it should, enabling Carilend’s specialist staff to focus on exceptions and quality customer service.
• Profitability  – Handling high volume processing is a major factor in achieving profitability in Marketplace Lending. Just one loan could be funded by hundreds of lenders, so it is vital to have comprehensive, efficient software to minimise operational costs and achieve profitability and hence sustainability in this sector.

Recognising this, Carilend Barbados has managed, with the help of the Madiston Platform, to streamline its operations and, ahead of many of its peers, has achieved profitability whilst still delivering its exciting expansion plans.