Mobile phone lending firm Branch inks deal to advance Uber drivers loans
Under the partnership, high-performing drivers will leverage their data to qualify for loans starting from Sh30,000. PHOTO | FILE
What you need to know:
The financial technology company is using data from the taxi-hailing firm to grant loans to drivers who have high ratings and have completed 500 trips.
Mobile phone-based lender Branch has signed a deal with online taxi hailing company Uber to advance personal loans.
The financial technology company is using data from the taxi-hailing firm to grant loans to drivers who have high ratings and have completed 500 trips.
“At Branch, we are using alternative data sources and proprietary machine learning technology to overcome (credit risk assessment) and make accurate lending decisions,” said Daniel Szlapak, Africa director for Branch.
Under the partnership, high-performing drivers will leverage their data to qualify for loans starting from Sh30,000 repayable in six months at an interest fee of 1.2 per cent, comparable to the Central Bank of Kenya interest rate cap limits.
“There are now many more sources of data that lenders can use to underwrite borrowers. Digital jobs like driving an Uber (taxi) leave behind digital ledgers. Lenders can use these ledgers to do underwriting,” said Branch founder Matt Flannery.
Earlier this year, Sidian launched a Sh10 billion fund to advance loans of between Sh1 million and Sh1.5 million to each Uber driver.
The Sidian loans are repayable in three years at a fixed interest rate of 10.5 per cent per annum.
