Autochek, a pan-African auto marketplace, has announced a partnership with a Nigeria-based leading fintech company Appzone, to improve access to auto loans for prospective vehicle owners in the country.

This would be achieved through Autochek’s integration of Appzone’s digital banking platform, BankOne which has over 400 microfinance institutions on its network ready to provide access to credit facilities.

Access to credit is a major problem in Nigeria and most of the African continent due to the lack of credible national identity database and credit report making it difficult for lenders to determine credit worthiness or recoup loans. The few who can access loans get it at heavy double digit rates. Consequently, Africa’s $45 billion automobile industry has only a 5% financing penetration rate.

The introduction of bank verification number (BVN) which gives a unique identity to bank account holders in Nigeria has seen access to micro lending (less than $1000) significantly improve with little uptick in massive loans.

“Obtaining access to financing in Nigeria is a tedious process. At Autochek, we are  committed to providing consumers with seamless access to credit in order for them to own their vehicles and with technology, we are able to provide vehicle financing at scale,” Chief Technology Officer Autochek Chetan Seth, commented.

Meanwhile for Appzone, the partnership would mean that the microfinance banks can now target more customers as well as increase revenue through loan offerings to prospective car owners. Both partners were did not disclose interest rates for the credit. But historically, they have been between 3% to 5% per month.

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