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WesBank, which is an arm of lender FirstRand, will rent cars to
Uber drivers who do not qualify for traditional car loans due to
a lack of credit history.
Around half of car loan applications are declined in South
Africa, WesBank chief executive Chris de Kock told a news
conference.
WesBank will recoup the loan from the fares Uber drivers collect
from passengers, lowering default risk, de Kock said. The amount
drivers repay will depend on the level of business they are
doing.
Uber Technologies Inc, currently valued at over $50 billion,
uses a free GPS-enabled app to link drivers from private car
companies to passengers at cheaper rates and promises a quicker
response time - often within 10 minutes.
San Francisco-based Uber was launched in South Africa in August
2013 and operates in over 60 countries. Uber clocked 2 million
rides in South Africa in the first six months of 2015, Uber
said.
FirstRand's enterprise development group Vumela will educate
drivers on running their own business and also provide cash to
WesBank if car loans are not paid. It will also finance 20
million rand for the first 1,000 cars, Uber said.
(Reporting by Zandi Shabalala; Editing by Joe Brock)
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