Credrails co-founders Clara Odero and Teresia Kairu, alongside Vodacom Director and Audit Committee Chairman, Lazarus Muchenje, came together for an exclusive July webinar to discuss “Why Variance Matters in African Financial Institutions”.
What is variance and why does it matter?
In this roundtable, the panel starts from the basics: explaining what variance is and the high level of interest placed on variance even at board level and by multiple stakeholders. Muchenje, who is highly experienced as an operator with an audit background, raises the issue of how the accumulation of variance results in a multitude of problems in the worlds of banking and telecommunications, no matter how small the variance may appear initially.
Teresia Kairu, who has a wealth of experience working in the financial sector, stresses that a lack of good internal control or fragmented systems can lead to loopholes, financial exploitation and other forms of internal fraud. Simply put, organizations lose (and lose money) when they are not able to accurately track how cash is moving from one place to another.
The Birth of Credrails
Clara Odero shares that the prevalence of incidents like this is the reason she co-founded Credrails, an open banking platform that uses data to build products, including lending analytics and reconciliation. Credrails was designed to essentially solve the backend issues that many businesses suffer from, and help them not only scale better, but make it possible for the most innovative companies across the African continent to have seamless operations so that they could prioritize focusing on the day-to-day running of their business.
The Technology Problem
Muchenje adds that variance is all the more complicated when you couple together disparate systems and manual reconciliations. He talks about how there is a real ‘technology problem’ even in banking where legacy tools and systems are misaligned, not efficiently communicating with each other and difficult to update to modern world standards.
In addition, this technology problem extends to the human aspect, where there is rampant room for human error or manipulation of data (essentially fraud). He concedes that while variance cannot be resolved 100%, businesses should certainly do their “best to minimize it using appropriate technologies and interventions at appropriate times within the processes”, whether those processes are accounting, auditing, etc. Businesses, he says, should also stay abreast of staying on top of their tech adoption and invest in training team members who are interfacing with those technologies
Credrails - A Best in Breed Solution
Teresia points out that Credrails’ software speaks directly to this common problem of siloed systems being one of the core reasons for variance. Credrails serves as a middleman that is able to speak to “each and every system” (and their corresponding data points) utilized by businesses, then relays a complete picture that tells them exactly what their money is doing and where it's sitting.
Clara highlights Credrails unique features, from being able to ingest statements of any format, to extracting matching references quickly, to speedily cleaning up data that otherwise sits in a complicated state in other systems. And while variance comes part and parcel in any business, it’s clear that automating the reconciliation process is a necessary and crucial step towards reducing variance in the first place.
Thankfully, Credrails is a solutions provider that helps businesses scale smoothly as they grow. As Clara says, “You don’t have to figure out how to work with us; we figure out how to work with you”.
Watch the recap of the webinar below: