Hormuud Telecom and GetPhone have announced the expansion of their smartphone financing programme to four new Somali states: Jubaland, Southwest, Hirshabelle, and Galmudug. This expansion brings the total number of branches to 15, driven by high demand for the programme. Since its launch, the programme has sold over 2,500 smartphones. The expansion aims to increase access to smartphones in these regions.
The smartphone financing programme offers customers the opportunity to purchase smartphones at an affordable monthly payment plan. GetPhone has deliberately financed customers across a wide range of credit scores to test how closely those scores predict actual repayment. This approach allows GetPhone to assess the creditworthiness of customers and make informed lending decisions.
Preliminary analysis of nearly 1,700 contracts signed in August shows that customers with credit scores under 500 have repaid 89.7% of amounts due, compared with 90.5% among customers scoring 650 or above. This data suggests that credit scores are a relatively reliable predictor of repayment. The programme has attracted a diverse range of customers, with SME traders and private-sector employees accounting for nearly 60% of the portfolio.
The majority of customers in GetPhone’s August portfolio are first-time smartphone buyers, with an estimated 89% of customers purchasing their first smartphone. Additionally, nearly two-thirds of customers are under 35 years old. The average reported monthly household income is around $264, which is roughly equivalent to the cost of one of the two available phones.
The two phones currently available through the programme cost approximately $238 and $317 if bought outright. This means that either phone can cost around a month’s household income. Despite the relatively high cost, the programme has been popular among customers, with over 2,500 smartphones sold since its launch.
Women account for over 20% of the portfolio, indicating a significant level of female participation in the programme. The programme’s expansion to four new Somali states is expected to increase access to smartphones and financial services for a wider range of customers.
The smartphone financing programme is a partnership between Hormuud Telecom and GetPhone, two leading companies in the Somali telecommunications industry. The programme is expected to contribute to the growth of the Somali economy by increasing access to financial services and smartphones.
Key points
- Hormuud Telecom and GetPhone expand smartphone financing programme to 15 branches across four Somali states.
- The programme has sold over 2,500 smartphones since its launch.
- Customers with lower credit scores have demonstrated relatively high repayment rates.
