The COVID-19 pandemic is not only a global pandemic that has led to the collapse of public health, it has also severely affected the global economy. With this, there is a sudden surge of debt on individuals as someone or the other from their families are either hospitalised or going through major financial crises due to job losses.
Debt collection, which remains one of the principal elements of the consumer finance industry, has been at the forefront, especially amid pandemic. In the UK nearly 9 million people are over-indebted and it has been only increasing, thanks to the ruckus created by the Covid-19 pandemic.
This is where London-based Oplelos aims to create a difference. The startup aims to ease the process of debt collection with the help of technology has raised a $2.3 (nearly €1.9M) pre-seed investment round. The funding round was co-led by Connect Ventures and Fly Ventures.
With this round of funding, the startup plans to continue to build its debt management platform along with growing its engineering and customer operations teams.
Amon Ghaiumy, co-founder & CEO at Ophelos says, “The debt collection industry desperately needs to change towards a more technology-driven, and most importantly, customer-centric approach. The company, therefore, wants to ensure that everyone is financially educated, empowered and equal.”
How does Ophelos work?
Co-founded by Amon Ghaiumy (previously Director of EMEA at AI company ASAPP), Paul Chong (previously Head of IBM Watson EMEA) and Prof. Qingchen Wang, a leading AI researcher and professor at the University of Hong Kong, Ophelos aims to make hassle-free debt collection processes with the help of Artificial Intelligence (AI) and behavioural science.
In an exclusive interview with Silicon Canals, Amon Ghaiumy, co-founder of the startup says, “Ophelos partners with enterprises to carry out debt collection services for them and then charge a fee based on the services.”
The idea of launching this startup came after Amon and Paul saw the way debt collection agencies function by calling people at odd hours and the use of outdated technology. Ghaiumy shares, “Debt collection agencies use very antiquated communication methods to contact people, such as calling people on the phone at odd times, and there is no flexibility in how people engage and pay back the debt. With personal debt at record levels, debt collection agencies are going to be more in demand than ever. Yet there is a disconnect between their practices and actually helping people to improve their financial health long-term.”
Then Wang joined the team to lead the company’s tech and AI efforts. “Paul, Qingchen, and I knew there was something that needed to be done here, so we can make the collections process more efficient and effective for businesses, but also more humane for the customer,” he further adds.
The authorisation and regulation from the Financial Conduct Authority in the UK were some of the initial challenges. Ghaiumy says, “The initial challenge was to get authorised and regulated by the Financial Conduct Authority in the UK, so that the partnership with clients can become reality. Finally, the startup has received authorization in the UK.”
In terms of numbers, even before the FCA authorisation, Ophelos tested its platform in Australia with a leading financial services provider. According to Ghaiumy, the company saw a rise of 24 per cent in debt recovered and a 28 per cent reduction in costs for businesses in Australia. The customer engagement also increased by 68 per cent.
In the UK, Ophelos has clients like energy supplier and a challenger broadband company.
Ophelos Expansion Plans
Currently, Ophelos’ team strength is 12 people. In terms of expansion, the startup is planning to make its base in the UK market and then aims to go beyond Europe.