My parents, like most working-class couples in the ’90s, turned their house into a home on credit. They got a piece of furniture from Pelhams and another from Nyore Nyore. Everything in reserve. It took a few years, but they paid for it all and the upgrades began.
If they had been forced to buy those items outright, they would have had to fill their house with one item at a time. They would have had to watch TV while sitting on the floor while saving for masofa.
In the west and even all over the Limpopo, they still live life the credit way. While you had to save $5,000 to buy your Honda Fit, your friend from the south bought a new one. Suzuki Swift for $175 a month for 6 years.
That car costs close to $10,000 in cash and his friend from the south would not have been able to afford it if it hadn’t been for the credit option.
Depending on the type of collateral you have and what your payroll looks like, you can also get cars on credit in Zimbabwe. However, the cars are a great purchase. What about mobile phones? What if you could get a new smartphone on credit?
We have watched longingly for years as our colleagues in other countries use the latest Apple and Samsung flagships, while we have to deal with 5-year-old phones. They can afford to keep up with the latest phones because they get those phones on credit.
We don’t have many options to get phones on credit in Zimbabwe, so when I found one, I had to share it.
Mobile Device Loans
Bridgevest Capital is offering mobile loans and this is what the deal looks like:
- 6 month holding
- 12.5% interest
- 3% establishment fee
- Currency: USD
- The minimum quantity depends on the price of the device.
It’s not exactly like the 24- and 36-month plans some get in other countries, but it’s still a credit option. The 12.5% interest is high, but it is the prevailing interest rate on most USD loans on the market.
If you chose a $500 phone, you would pay a $15 setup fee and $62.50 interest. Making a total payment of $577.50. The setup fee must be paid before they process the loan for you. So if you commit to equal installments on the $562.50, you will have to pay back $93.75 per month for 6 months.
That sounds more doable than shelling out $500 outright. Would it have been even better if the loan was for 12 or 24 months? Of course, the monthly payments would have been lower. However, to say that a deal could have been better does not mean that it is bad per se.
What you need to get the loan
So if you decide it’s about time you put that 8-year-old iPhone to rest, here are the hurdles you need to overcome to get that device on loan.
If you are a civil servant, you already know that it will be easy for you to access these loans. You just need to provide a payslip and a copy of your ID and you will get your loan within 24 hours of applying.
If you have a formal job in the private sector and earn USD, then you can also access device loans. You will need to provide a certified copy of your identification, a letter of employment on letterhead or stamped paper, and your current payslip.
It sounds more or less the same as for civil servants, however, there is still a hurdle. You will need your employer to enter into an agreement with Bridgevest Capital whereby they collect your salary refunds on behalf of the lender.
We talked about this when we looked at the microfinance industry in Zimbabwe. This is the solution lenders came up with to limit their risk.
So even if you don’t have trouble paying a loan, if you don’t have a payroll, you won’t get one. If you’re employed and on payroll, you still have to convince the HR and finance guys at your employer to agree to a stay-order type of deal with Bridgevest.
All of this means that most Zimbabweans will not qualify for these device loans. This is how things are in Zimbabwe at the moment.
If you are among the lucky ones, keep in mind that there are other loans available as well. If you don’t need to upgrade your device, you can borrow whatever you want. It will be the same interest rate and establishment commission as the previous one. The only difference is that the minimum loan amount will be $100.
You can apply for these loans through WhatsApp, email or a web portal. Visit the Bridgevest website if you want to get into action.
What do you think about all this? Will you get a loan so you can finally find out what the hype is all about with the Galaxy Fold 4? Or is it in the ‘if you can’t afford it without a loan, then you can’t afford it’ camp? Let us know in the comments below.