In a bid to bridge the huge internet connectivity/access gap in Africa, the continent’s biggest telecoms/technology firm, MTN has initiated a buy-now-pay-later (BNPL) scheme to put smartphones in the hands of many Africans on credit, beginning from Nigeria.
Through its latest partnership with Intelligra, a pioneering smartphone financing company in Nigeria, the telco is providing its customers access to modern, internet-enabled phones through a flexible BNPL scheme, which lasts between 6 and 12 months.
According to MTN, the overarching purpose of pioneering a telco-led BNPL product in Nigeria goes beyond profit-making. Their goal is to connect more Nigerians to the internet and create a Nigeria where people are not restricted from achieving their dreams due to a lack of internet access.
Other stakeholders in the multi-party partnership include SLOT, a nationwide mobile phone dealer, Stanbic IBTC bank, a key financier, VFD microfinance bank, and some other retail partners.
While the financiers provide the deep pockets needed to scale the mass rollout of the BNPL product, fulfillment partners like SLOT help to complete last-mile delivery for users across the country.
Speaking on the partnership with Intelligra, Adia Sowho, Chief Marketing Officer, MTN Nigeria, said: “The partnership with Intelligra will drive financial inclusion, digital financing devices, and make them accessible to the average man. It would also grant customers access to the internet, entertainment, and education while allowing users to communicate easily.”
Tayo Ogundipe, CEO and founder of Intelligra Solutions Ltd, expressed confidence in the ability of the partnership to unlock rapid digital inclusion and economic opportunities for Nigerians.
“This partnership with MTN, the foremost telecom provider in Africa and collaborations with financing institutions including StanbicIBTC, VFD MFB, Personal Trust MFB, Credit Direct Ltd. and others, will help proffer a solution to the low smartphone penetration for Africans and increase digital and financial inclusion,” he said.
“The ecosystem also comprises key partners who will offer MTN users across the country a unique, convenient, simple, and flexible variant of BNPL with their choice of premium, quality brands, including Samsung, Nokia, Tecno, Infinix, and iTel models,” he added.
Although the online KYC process requires submitting a BVN number, Intelligra maintains that customers’ BVNs are collected in line with regulatory practices and are not used to assess creditworthiness. Rather, customers are assessed for credit based on their prior behaviour—such as airtime recharge pattern—on the MTN network.
Notably, the BNPL phones are restricted to users of the MTN network (at least one of the sim cards must be MTN). And in the case of a loan default, the phone’s functionality can be remotely disabled. As part of the product offerings, customers are entitled to a one-time screen replacement or a phone replacement in the event of theft.
According to a GSMA report, between 2019 and 2020, the number of sub-Saharan Africans subscribed to mobile services grew by 20 million. Africa’s rapidly growing technology space is currently mobile-led. So, a solution like this, which puts modern mobile phones into the hands of Nigerians, seems like a commendable move by MTN.
Meanwhile, MTN and its partners have maintained that they’re not just offering regular buy-now-pay-later phones. According to them, these phones will come with embedded voice and data plans, which qualifies them as wealth-creation tools in the hands of their users.
Ghana
Meanwhile, in Ghana, Techgh24 is reliably informed that some tech start-up has designed a similar scheme and is in discussion with MTN Ghana for a rollout. But no clear rollout dates are in sight yet.
