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Betacar.ng has introduced an auto loan financing product for its users, which it hopes will help customers move toward vehicle ownership.

The product, which is still in beta, is available only to users residing in Lagos, the commercial hub of Nigeria. The company plans to extend the loan product to the rest of the country in the future.

The financing option, which is powered by an unnamed financial institution, enables users to make a down payment of 30% for their proposed vehicle, with the remaining balance spread out over a maximum of 12 months.   

Betacar and its financial partner charge an almost 20% interest rate, which the companies split at the end of the loan period. This might be a high rate for users in advanced markets, but for frontier markets like Nigeria where access to capital is limited, it’s considered a fair rate. 

Betacar was recently launched in Nigeria by ex-Yahoo employee Lou Odunuga. The company’s major competitors in the market include Roam-backed Chek and multimillion-dollar funded Cars45.