Uber Signs $14 Mln Car Rental Deal With South Africa’s Wesbank
Online taxi-hailing service Uber has agreed a 200
million rand ($14 million) deal with South
African vehicle finance provider WesBank to rent
cars to drivers who can’t afford to buy them, the
companies said on Tuesday.
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 US dollars, 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.
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