SOUTH AFRICAN network operator Vodacom has launched a loan product offering quick small loans from just R50, so the fees are also much cheaper than a mashonisa or loan shark, he says.
Vodacom customers can now access a cash advance from R50 to R500 and settle it on four different payment terms.
Customers can choose to repay funds in seven, 14, 21 or 28 days.
Its fees are cheaper than traditional providers of short-term cash advances and, on average, 400% cheaper than a loan shark, said Mariam Cassim, chief executive of Vodacom Financial Services.
The new VodaLend Cash Advance product is aimed at its underbanked customers and provides access to fast and secure cash without the barriers associated with accessing unsecured loans.
“VodaLend Cash Advance provides affordable access to loan products for those who need these services the most but have historically been prevented from doing so due to high fees and difficult-to-navigate documents,” Cassim said.
Cassim said that despite 26 million South African consumers having formal credit records, there was still a significant portion of the population without access to formal financial services.
As part of the approval process, VodaLend Cash Advance uses its customers’ recharge and payment patterns and behavior to determine their level of affordability.
The company said it will ensure the loan solution is accessible to more people, including new borrowers, who can now access regulated credit.
The product is an addition to its awesome VodaPay app, launched by Vodacom last year.
Once the loan is approved, the money is advanced directly into the user’s Vodapay digital wallet, which can be used instantly for in-app purchases such as buying electricity and paying utility bills. Customers can also scan to pay in stores and send money to friends and family.
Since the launch of the VodaPay super application, the telecom operator has attracted 2.8 million downloads.
– Business Insider SA