CSH

CSH Image

Region

Africa

Deal type

Expansion

Investment date

2014

Status date

Current

Reducing credit risk

It’s easy for consumers and businesses in the developed world to forget that every line of credit – be it a mortgage, a bank loan or the payment in instalments of a large purchase – is likely to be underpinned by enquiries into their creditworthiness. This is what credit bureaus do – risk-assess customers’ ability to repay. It is an essential tool for financial organisations to determine interest rates, reduce their exposure to bad debt, and ultimately promote access to credit – yet it is seldom available in sub-Saharan Africa, where just 5% of the adult population is covered by credit bureaus (by comparison the OECD average is 63%).

In a bid to fill the gap in the market, Actis set up Credit Services Holding (CSH) in 2014, a buy-and-build credit services business in which it plans to invest $100 million. CSH’s first acquisition was Compuscan, the largest independent credit bureau in Africa and one of the fastest-growing. Based in Stellenbosch, South Africa, it provides credit data and analytical services to customers including banks, insurance companies, retailers and telecom operators across several African countries including South Africa, Namibia, Ethiopia, Lesotho, Botswana and Uganda. CSH made its second acquisition, PCubed, in early 2015. PCubed is a leading analytical marketing services business in South Africa, servicing blue chip banking and retail customers.

To grow CSH into a leading credit services platform in Africa, Actis recruited First National Bank’s former CEO and African finance powerhouse Michael Jordaan as CSH’s chairman. Jordaan and the Compuscan management team have invested alongside Actis and the company plans to grow both organically and inorganically – Compuscan is looking to expand in West Africa and Asia.