Uber, a US-based car hailing service, and Sidian Bank, a Kenya-based commercial bank, recently announced they will support Uber drivers in the purchase or lease of new vehicles.
The initiative is divided into a “vehicle finance component” made available through Sidian Bank and a “vehicle leasing component” offered by Zohari Leasing, a Kenya-based financial services company. The total value of the program is estimated at KES 10 billion (USD 100 million).
The “vehicle finance component” offers loans up to 100 percent of the value of vehicles with prices between KES 1 million (USD 9,900) and KES 1.5 million (USD 14,850), which has to be repaid within 36 months at an interest rate of 10.5 percent per year. In order to be eligible for the program, drivers need to have completed more than 500 trips with an average Uber rating higher than 4.6 out of 5.
Drivers not meeting this requirement can apply for Sidian’s conventional finance program to fund up to 90 percent of the price of the vehicle. Details regarding Zohari’s leasing forthcoming Uber product have not yet been made available.
As of December 2015, Sidian Bank reported total assets of KES 19.1 billion (USD 189 million) and total equity of KES 3.8 billion (USD 38 million). As of the same data Uber was valued at USD 62.5 billion.
By Kevin van den Brink, Research Associate
About Sidian Bank
Sidian Bank, was established in 1984 as K-Rep, a project that supported the development of small and micro enterprises. In 1987, the project expanded into a Non-Governmental Organisation (NGO). In 1989, K-Rep established a micro-credit lending program, in addition it added research & product development, technical assistance and a capacity building service. K-Rep Bank, K-Rep Development Agency and K-Rep Advisory Services were established in 1999. As of December 2015, K-Rep Bank reported total assets of KES 19.1 billion (USD 189 million) and total equity of KES 3.8 billion (USD 38 million). In January 2016, the bank changed its name to Sidian Bank.
Sources and Additional Resources
[1] CPI Financial, News, “Uber Kenya and Sidian Bank Launch KES 10 Billion Driver-Partners Programme”
MicroCapital Universe Profile: Sidian Bank
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