Knowledge

Author: Ollen Machimbirike

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Date: 1 August 2016

Sidian Bank Lauches Car Loan based on Uber Data

Sidian Bank
Uber’s recent arrival in Kenya has not only disrupted the traditional taxi industry but has also brought an incidental by-product which looks set to make inroads in the East African nation’s highly constrained credit market.
Kenya’s consumer lending market has historically been severely limited by the lack of consumer data. Currently, only 4.4% of population have taken out a personal bank loan with most Kenyan’s facing an average interest rate of 18%. However, in this era of unprecedented connectivity, the transport company is now also helping to bridge this credit gap.
Through the use of Uber driver data, Sidian Bank has launched a new car financing scheme that takes an innovative stance on assessing creditworthiness. The bank is offering up to 100% vehicle financing (with a maximum of approx. USD 15 000) to Uber drivers who have met the credit criterion. The credit criterion for successful application requires drivers to have a customer rating at minimum of 4.6 out of 5 and should have completed over 500 trips with Uber.
The new scheme will be a welcome opportunity for many of Kenya’s Uber drivers who usually do not own their vehicles, and as such lose a large portion of earnings to the owners.
While a similar scheme has also been launched in South Africa, the credit market conditions in Kenya are a better reflection of the continent as a whole. if the scheme is found to be successful in Kenya, there is little reason for it to not be replicated further throughout Africa.

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