NAIROBI, KENYA: Mobile phone companies are betting on loan arrangements with financial providers to increase sales and drive smartphone penetration in the country.
The model which is gaining momentum in the country has seen Equity Bank, Safaricom and Lipa Later offering financial assistance to consumers who are opting for flexible repayment methods in owning smartphones.
Lipa Later recently entered into a partnership with OPPO to offer credit to consumers buying its latest models which some retail at over Sh35, 000
“We believe through this credit payment option; more customers will have an opportunity to access this great device thus boosting our revenue in sales,” said Jesse Wu, Brand Manager, OPPO Kenya.
At the same time, Lipa Later’s Claudine Gakundi Business Development Manager said: “We believe this partnership will give an opportunity to customers who would like to own a good smartphone and cannot pay upfront, but through installments. At Lipa later we guarantee full payment of your device as we give you an opportunity to pay without a hustle.”
According to the company, the new deal will increase sales of its products and accelerate smartphone mobile penetration into the country as Kenya is a strategic conduit in the Eastern African market.
Two years ago, Equity Bank also announced the launch of a loan product meant for Equitel customers to acquire smartphones. The Loans for Smartphones promotion will require the Equitel customers to purchase smartphones from Samsung, Alcatel and a few other brands and pay back the loan within one to 12 months.
As opposed to Safaricom that offer smartphone loans under a “hire purchase” model, Equity Bank Loans for smartphones is like a normal loan where customers do not have to provide any down payment, but pay back the loans only on instalments on a daily, weekly, monthly or otherwise until the loan is fully repaid with interests.
In a recent study by e-commerce company Jumia, smartphone penetration in Kenya stands at 83 per cent keeping Kenya ahead of its peers in the continent in terms of Internet access.
“Kenya is the global leader in share of internet traffic coming from Mobile (overtaking Nigeria in 2017), at 83 per cent,” read part of the report, dubbed 4th White Paper Report.
The report showed that access to the internet by Kenyans was mostly through mobile phones with uptake of smartphones in the country reported to have increased in 2017 compared to 2016.
