Now all you need is a mobile phone or an internet connection. The reason that’s possible is because of companies like the UK-based Wonga, which today announced South Africa as its first stab at international expansion.
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The award-winning company can lay claim to a couple of innovations in the tech-finance including being the first to use fully automated risk processing technology.
Wonga claims that its automated technology is actually safer than going into a bank for a loan:
We believe that because we make our lending decisions without the need for human intervention or hard documentation, our decisions are more likely to be accurate as there is no room for subjectivity or human bias.
The company, which has already granted over 4-million loans worth £-1 billion to UK customers, has deep links with South Africa. Its two co-founders Errol Damelin and Jonty Hurwitz are both originally from the country.
In South Africa, the Wonga will allow applicants to choose the exact amount they wish to borrow (up to a maximum of R2 000 for first-time users) and to select the amount of time they wish to borrow it for — from a few days to around a month.
The total cost of repayment, it says, is calculated in real-time and clearly displayed on the homepage, before the customer proceeds with the online application process
Wonga SA CEO Kevin Hurwitz says the company has done its research and reckons the SA market is ready for a service like Wonga.
“Consumers have had to rely on traditional forms of credit and financial services for too long, with very little choice or alternative options available to them. Wonga.com offers customers a totally new approach to credit – 100% online, consumer-focused, transparent and responsible”.
Hurwitz also says the decision to launch an SA offering was based on more than the sentimentality of its founders and that it is “based on a deep understanding of the local market and its consumers’ needs. South Africa is an exciting developing market to begin the company’s international expansion journey”.
Underlining the fact that the company is here to make money is the CEO’s statement that the company will “only grant a loan to an individual whom we believe is able to pay us back without causing additional financial strain. In fact, we only accept around a quarter of first-time applications for loans”.
It will, however, face local competition from the likes of Boodle, which appears to have a similar interface to Wonga. There are also a whole host of sites that offer loans to people with bad credit, but I can’t see them winning awards any time soon.
