M-Shwari raises the stakes for Kenya's Safaricom

Safaricom's M-Shwari loan for smartphones, otherwise known as Smart Loan, has already netted 6,500 purchases of smartphones and tablets in one month.

The M-Shwari service allows M-Pesa users to open bank accounts and save money right from their phones in conjunction with Commercial Bank of Africa (CBA).

The service has been a hit with most M-Pesa users and now has seen over 9 million accounts opened and savings totalling Kshs135 billion (US$1.5 billion) in two years since its launch.

"We have so far disbursed loans amounting to Kshs. 24 billion (US$0.2 billion), while maintaining a repayment rate of 97% which is by far more impressive than the repayment rates for loans advanced by commercial banks," Jeremy Ngunze the chief executive officer at CBA said.

Customers who want to purchase devices through this service will have to fork out a down payment equivalent to 30% of the device and pay the balance in six months.

"Kenya's smartphone penetration has been growing phenomenally over the past five years, but there are still many customers who are not able to afford a device. We believe that by coming up with this proposition we make it possible for customers to access the wealth of knowledge available on the internet," Safaricom's Chief Executive Officer, Bob Collymore said.

"This move also fits in well with the ongoing rollout of our 4G network as we also work to increase the number of 3G sites in Kenya five-fold in the coming five years. Customers can now take advantage of the offer to purchase the latest hardware to enjoy fast, affordable and reliable internet services," Collymore said.

SOURCE:ITWEBAFRICA