Motor Africa, a Nigerian mobility and IoT infrastructure start-up, have teamed up with fintech infrastructure provider, OnePipe, to offer a hybrid credit and payment service to mobility entrepreneurs in Nigeria. The partnership aims to enhance Motor-Africa’s insurance offerings and enable OnePipe to expand its customer base in the insurance sector.
Both platforms have launched a lending-as-a-service (LaaS) proposition which will provide working capital for mobility entrepreneurs through overdrafts, allowing them to finance car repairs, purchase genuine spare parts, obtain vehicle and personal insurance, and receive cash for personal and family welfare support needs.
The technology assists registered lenders in making informed lending decisions by generating analytical telemetry and remittance income data.
According to Sylvester Chude, the CEO and co-founder of Envio Logistics Inc, who has been actively involved in the mobility industry, the partnership with OnePipe will make it easier for vehicle owners and lending partners to receive automatic payout settlements.
“Commercial transportation is a crucial service for the growth of any economy, and the role of technology and innovation is essential for its success in Africa,” Sylvester Chude said.
According to the African Development Bank, mobility in Africa is an estimated $150bn market, and was expected to grow at 8.5% between 2018 and 2023. The partnership between OnePipe and Motor Africa aims to address the challenges experienced by African mobility entrepreneurs when trying to access working capital financing.
OnePipe CEO and founder, Ope Adeoye, hopes that working with Motor Africa will provide a solution for the shortage of capital and help entrepreneurs access credit facilities to grow their businesses.
Motor Africa, also known as Envio Logistics, is set to grant vehicle owners access to credit. This service will manage driver repayments to the vehicle owner and provide car maintenance oversights at partnered workshops. It currently offers services in Lagos, Abuja, Ibadan, Benin, and Port Harcourt, with plans to add more locations in the second quarter of 2023.
The LaaS infrastructure, which utilizes hybrid telemetry IoT systems, enables lending partners to create loan products with interest rates and repayment terms, manage credit requests, automatic underwriting, cash disbursement, and repayment collection.
The intelligent repayment collection service enables credit subscribers to make repayments via bank transfer to a dedicated repayment wallet before the due date. When subscribers default on their repayment, the system will automatically disable the engine of the collateralized vehicle and share the geolocation with Motor Africa recovery agents, in case of default.
The Motor Africa service is recommended for hosts leasing cars to e-hailing services, last-mile transport services providers, drivers seeking short-term leases, or hire purchases, and financial institutions offering drive-to-own services or lending. Motor Africa will soon be offering a comprehensive range of automotive services such as car maintenance, repair and diagnostics and concierge services for customers. This is a significant step in the right direction for mobility in Africa, where entrepreneurs previously struggled to access funds or obtain financing due to a lack of credit risks appraisal, poor or non-existent credit histories and lack of collateral, therefore preventing local businesses to grow while the demand for transportation far outstrips supply.