NAIROBI, Kenya, July 20 – As smartphone adoption deepens throughout Kenya and Sub-Saharan Africa, Watu Simu – a subsidiary of asset financing agency Watu – is betting large on increasing entry to reasonably priced smartphones via versatile, pay-as-you-go financing.
Speaking to Capital Business, Kevin Michuki, Head of Growth at Watu Simu Kenya, displays on the corporate’s journey, buyer influence, and the way current legislative reforms are shaping the digital lending panorama.
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How many smartphones has Watu financed to this point, and what are your projections?
Watu is celebrating its tenth anniversary this 12 months. In simply over three years since we entered the smartphone area, we’ve financed greater than three million gadgets throughout our eight markets. It’s a strong milestone — but we’re solely scratching the floor. With smartphone penetration simply over 70%, there’s nonetheless important room for progress. In Kenya alone, we’re operational in all 47 counties, and we see continued growth throughout East Africa and our newer African markets.
Who makes up your buyer base — rural or city communities?
Our clients are primarily in underserved areas, usually people with out entry to conventional credit score. Our purchase now, pay later mannequin permits them to make a small down cost after which repay in day by day or weekly instalments. We’ve made it extra versatile via a pay-as-you-go platform, which adjusts to clients’ earnings patterns and preferences.
There are claims that BNPL will increase the price of possession. What’s your view?
At Watu, we promote aspirational purchases — giving individuals entry to expertise they in any other case wouldn’t afford upfront. Customers are effectively knowledgeable about mortgage phrases from the beginning. For many, the choice to pay over time is an enabler, not a burden. It brings the most recent expertise inside attain in a manageable and clear approach.
How do smartphones influence low-income communities?
Our inside knowledge exhibits that 80% of our clients use their smartphones for income-generating actions. These aren’t simply gadgets for communication — they’re instruments for enterprise. Whether it’s on-line retail, supply companies, digital funds, or content material creation, smartphones are serving to individuals unlock financial alternatives.
How do you stability affordability with default threat?
The purchase now, pay later mannequin is designed round our clients’ earnings cycles, which drastically reduces the chance of default. Most of our shoppers view smartphones as a necessity, not a luxurious. It’s how they earn a dwelling, run their enterprise, and entry important companies. That intrinsic worth encourages reimbursement.
What is Watu’s stance on the brand new Business Laws Amendment Act?
The Business Laws Amendment Act of 2024 is a welcome growth. It strengthens client safety, promotes contract readability, and gives a stronger framework for accountable lending — rules we already adhere to. It’s additionally fostered a extra secure atmosphere for partnerships to thrive. We’re proud to work with Samsung, for example, to ship reasonably priced gadgets, and we proceed to help our huge supplier and agent community, which contains hundreds of people incomes a livelihood via Watu.
