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VodaLend targets underbanked

Vodacom has launched a Cash Advance product for underbanked customers, promising barrier-free access to funds

Vodacom Financial Services has launched a product that promises to give customers quick, secure and nbarrier-free access to funds.

VodaLend Cash Advance is the latest product to be added to the VodaLend financial services suite, which includes VodaLend Compare, Voucher Advance, and Airtime Advance. The new addition is geared towards urgent need for funds, such as an emergency doctor’s visit or topping up pre-paid electricity.

Available to Vodacom customers through the VodaPay super app, the financial services offering forms part of the telco’s “purpose-led ambition”, which it says includes accelerating financial inclusion for all South Africans.

“With only 26-million South African consumers having a formal credit record, there is still a significant part of the population that doesn’t have access to formal financial services,” says Mariam Cassim, CEO of Vodacom Financial Services. “VodaLend Cash Advance provides affordable access to lending products for those who need these services most, but who have historically been prevented from doing so due to high fees and difficult-to-navigate paperwork. It is also accessed in-app on a trusted digital platform, enabling a seamless, convenient, and secure process for customers.”

Vodacom customers can access a cash advance from as little as R50 and up to R500, with the option to settle it over seven, 14, 21 or 28 days. In addition to the regulated requirements for affordability checks, the credit decision process is enhanced by looking at a Vodacom customers’ recharge and payment behaviour. This ensures that the service can be accessed by more people, including first-time borrowers who can now enjoy the benefits of a secure, regulated lending solution. 

Once approved, the money is advanced directly into the user’s VodaPay Wallet. It can be used instantly for in-app purchases, including buying prepaid electricity and water, paying bills, scan-to-pay in shops, and sending money to friends and family.

Says Cassim: “This innovative product is a potential game-changer, as its fees are less than traditional short-term cash advance providers. On average, it’s up to 400 percent cheaper than using a mashonisa – it moves us beyond financial inclusion to real financial impact.”

Consumers are shifting their behaviour due to increased financial burdens, like a higher cost of living. This imposes a greater need for companies to deliver personalised, innovative, and accessible services. Vodacom Group’s recent financial results for the year ended 31 March 2022 revealed growth for the telco’s new financial- and digital services – up by 8.5 percent – and indicated that meeting this need is on a positive trajectory.

“Since launch in October last year, our super app has attracted 2.8 million downloads, showing a huge appetite for participation in the digital economy. VodaLend’s product suite is also performing well,” says Cassim. 

The VodaPay super app is available for download from the Apple and Android app stores. To access VodaLend Cash Advance on VodaPay, click on Services on the Home Menu, and find VodaLend Cash Advance under Finance.

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