AAR subsidiary to offer loans via mobile phones
MEDICAL insurer AAR's subsidiary AAR credit services has unveiled a service that will allow borrowers access and repay loans via mobile phones. The new service will enable Airtel customers subscribed to the network's mobile money transfer product Airtel money, access loans through the system.
The technology platform that will facilitate the service has been developed by software firm Rapid Communications in a deal that also involves pan African bank UBA which will be the settlement partner of the money transfers made. “With this service it now makes it easier for somebody with an airtel money account to to get a loan which will also be repaid through the same account,” said AAR Credit services managing director John Kariuki.
UBA said the service will enhance its presence in the region where mobile phone use is growing rapidly. The loan will be repaid weekly, explained Kariuki and the maximum amount a borrower will be eligible for will depend on their use and average balances on their airtel money accounts.
This will be the second type of loan product to be disbursed through airtel money after an almost similar product was launched earlier in the year between the mobile phone service network and micro finance firm Faulu Kenya. AAR Credit was launched 12 years ago with an initial scope of financing people to purchase AAR premiums but has since evolved its business operations to respond to the demand for affordable and easily accessible loans in the market.