EFL began as an idea of co-founders Bailey Klinger, a fellow at Harvard’s Center for International Development and Asim Khwaja a professor at the John F. Kennedy School of Government at Harvard University, while they were participating in the CID South Africa Growth Initiative.  They were struck by the fact that entrepreneurs' access to finance could be such a problem in South Africa, a country with a financial system more developed than many high income (OECD) countries.  After spending some months analyzing the problem, Asim and Bailey focused on low-cost screening tools and alternative financial contracts as methods to stimulate entrepreneurial finance.





  After a small feasibility study, Asim and Bailey received a grant from Google.org and SNV Latin America to launch the ‘Entrepreneurial Finance Lab’ project within Harvard’s Center for International Development. The aim of this project was to pilot test alternative screening tools in a network of financial institutions across Africa and Latin America. During the next two years, the Entrepreneurial Finance Lab worked with the world’s leading psychometric firms and entrepreneurship researchers to assemble a prototype credit scoring tool.





  The Entrepreneurial Finance Lab became an independent private organization that has developed and rapidly spread and scaled-up tools to identify high-potential entrepreneurs and perform credit scoring. EFL works in partnership with the Entrepreneurial Finance Lab Research Initiative at Harvard’s Center for International Development, which is the home of EFL’s research into the impact of psychometric tools on access to finance, entrepreneurial training and skills, and experimental alternative financial contracts.





  Less than one year later, EFL was named a winner of the G-20 SME Finance Challenge and recognized as one of the most innovative solutions to SME finance in the world. With the IFC and G-20 assistance and a partership with the Inter-American Development Bank (IDB), EFL increased its reach throughout the African continent and to Latin America.





  EFL continued to expand and entered the Asian market. That year EFL also won The African Business Award for Innovation for their work helping banks profitably identify and lend to credit worthy businesses they had previously rejected due to lack of credit histories.





  EFL has forged ahead as a leader in applying psychometric principles to credit screening. Along the way EFL has built new partnerships, more than doubled the number of EFL Applications administered globally and continued on its mission to enable the access to finance to high potential, credit worthy entrepreneurs. 




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