A Covid-19 Vaccine (for Lenders)

By Gib Lopez, Co-Founder and COO and Camila Perez Aloi, Senior Risk Manager

When we started PayJoy five years ago, our theory was that we could unstick the credit ecosystem by providing customers with little or no access to credit with collateral in the form of smartphones and giving lenders the ability to effectively collect against overdue payments.  That thesis has now been proven out in over 20 countries but faced an unprecedented test in the form of coronavirus and its impact on economies on incomes.

Fortunately, repayments powered by PayJoy have proven to be remarkably stable, with only slight repayment decreases from our pre-coronavirus levels.  This pattern is consistent across mature and new cohorts as our smartphone locking technology continues to provide a powerful incentive to repay.

Before looking at our results, it’s important to acknowledge how fundamentally Covid-19 has changed consumers’ lives and the lending landscape.  First, while this disease could infect anyone, it is hitting people with the least resources the hardest.  These are the people that can’t take sick days, that can’t maintain distance from strangers or customers, that don’t have savings they can rely on, and can’t easily access formal credit.  And while lenders have seen crises come and go, nothing really compares to what we’ve seen from the effects of the coronavirus.

Repayments have fallen off a cliff.  The Economist reports that one India lender’s non-payment rates have gone from 5% to 90% in a matter of weeks. Forbes is calling this a crucible for fintechs that will force many to “partner or perish”.  We’ve heard of others that have seen their repayments go to zero as customers hold on to every last dollar.  Cash lenders and retailers that sell on credit will continue to struggle or go out of business entirely as long as Covid-19 keeps economies shut down and threatens to roar back in successive waves.  Even those with deep pockets and sufficient funds will be forced to stop lending and sit on the sidelines.

However, across our own lending business and that of our partners, repayments have been strong with hardly a dip.  When indexed to “perfect” repayment, the impact of coronavirus isn’t even noticeable.  You can see this result in Fig. 1 below where we’ve tracked repayments for our last six cohorts grouped by month as compared to idealized repayments.  Of course, over time, all of these lines trend downwards as more and more people cease to be perfect repayers.  Without PayJoy, you could expect to see each cohort’s payments drop significantly when its Days on Book reached the first Covid-19 related impacts.  At these rates, PayJoy earns a reasonable return sufficient to attract institutional capital.

Fig. 1: PayJoy Portfolio Performance compared to perfect repayment.

Now, one way to achieve this result would be to let existing customers repay and then “improve” future cohorts by tightening credit policy just to very high quality or existing customers.  Of course, we did make some changes to our credit policies but these have only decreased approvals by around 5%.  But, generally speaking, PayJoy has continued lending to new customers with little (Fig. 2) or no credit (Fig. 3) and their repayment has done similarly well.

Fig. 2: PayJoy Subprime Borrower Performance compared to perfect repayment.
Fig. 3: PayJoy No Credit History Borrower Performance compared to perfect repayment.

So what is the PayJoy recipe for success?  There are four primary ingredients.

  1. We are bringing to bear a new, transformative technology in the PayJoy Lock that collateralizes a customer’s most valuable asset, their smartphone.  This has the effect of both discouraging bad customers from taking a loan (knowing they won’t be able to use their device once they miss a payment) and encouraging good customers to stay current.
  2. We and our partners give customers the flexibility they need in the face of volatile cash flows.  If they miss a payment, they no longer have use of their smartphone, but interest doesn’t pile up and they have a strong incentive to begin repayments.  And of course we always allow use of the phone to contact emergency services and can extend grace periods.
  3. We leverage the breadth of our smartphone financing platform to collateralize a device, underwrite and identify customers, identify fraud signals in customers or the sales channel, and, where applicable, score customers based on the data on their current device.
  4. We treat our customers with respect.  One of our core values is Transparency so the customer always knows what they are agreeing to, their total repayment amount, and how this differs from an ordinary purchase or cash loan.  We also understand when and why customers are likely to miss payments and have based our offerings on that knowledge.

While the challenges posed by coronavirus are unprecedented, we’ve found that our approach can protect lenders from the worst effects.  If you are interested to see how PayJoy could prevent lost revenue and profit for your credit purchases or on your loan portfolio, please contact us today at partners@payjoy.com to help us get billions worldwide access to credit.

PayJoy’s commitment to consumer privacy

By Jaideep Mirchandani, Chief Product Officer

In previous PayJoy blog posts, we highlighted the problem of lending to the underbanked and how PayJoy technologies are helping to solve this problem. Core technologies like the PayJoy Lock and Score enable our partners to reach underserved consumers by solving the collateral and credit scoring challenges. These consumers often don’t have other ways of getting the credit they badly need, especially in the current times of heightened liquidity risk.

The World Bank image below shows the severe lack of credit, especially in emerging markets. And this is before the COVID-19 crisis.

As we scale with our partners to serve more users, we believe it continues to be important that we protect the privacy of these users. We approach this holistically and have taken steps to safeguard user privacy in our products, our processes, and through collaborations with our partners. This post covers these aspects.

Let’s start with our products. To build products, we’ve tried to make conscious technology choices and have designed privacy into our products. We’ve been careful to use leading off-the-shelf technologies that have a strong roadmap. On the server side, we use public cloud infrastructure hosted on AWS. We use modern, public-key cryptography and https across the board so that we take maximum advantage of the innovation that will come on the world’s largest user infrastructure. 

In addition to best-in-class technology choices, we have implemented a layered approach (a best practice) to people and systems who access data. A good example of putting this to practice is with sensitive customer data. Quick recap: in markets where our Finance partners require a PayJoy Score to offer finance, we record a limited amount of such data (such as SMS) – with explicit user consent – for credit scoring. This ultimately enables financially excluded users to get and build credit in conditions where no alternatives exist. 

A small number of PayJoy employees access this data on a strict need-to-know basis, for instance, to build and test the systems that calculate or update a credit score. This data is hosted on separate servers with highly restricted access. The systems access this data via a modern, microservices architecture, which further limits access to a single, controlled interface.

In addition to layering, we proactively implement a data retention policy even when several governments (in our target markets) don’t mandate data retention policies. We wipe out all sensitive user data within 12 months of originally recording it. 

Let’s now consider PayJoy’s mobile apps. The PayJoy Lock is installed on the phones of end-users. The strength of this lock makes it possible for our Finance partners to be comfortable in lending money to underserved users by using the phone as collateral. Making the lock strong enough to withstand fraud requires PayJoy to have the right level of device locking capability during the term of the loan. We work with OEMs to enable the minimally required level of control  – while preserving user privacy – to enable device locking during the term of the loan.

Back to the end-user. To begin the process, our finance and retail partners explicitly describe the Lock-based financing model and its implications to the user. Users typically sign contracts to this effect. We don’t stop at human education. After this, the PayJoy mobile app discloses the device access we require and seeks user consent. We do this using a UI which clearly explains what capabilities we need and why. 

The app starts with an introduction and visual reminder of the reasons the PayJoy App needs locking capabilities (including device control required to lock). This is in clear language. The user has a clear choice to deny consent at each step of the process.

The user has the clear option not to activate. The PayJoy App reminds them (once) of the impact of declining, then makes it easy for the user to make the choice without further pop-ups or questions.

Another example comes from PayJoy’s anti-fraud measures. To protect the majority of our trustworthy and deserving users, PayJoy matches a National ID with a Selfie. Along the way, the app provides clear reasons why it takes this step. Once successful, it also auto-fills ID information into the subsequent application form to save the majority of our users error-prone and repetitive data-entry steps.

Let’s now consider our OEM collaborations. Overall, we see this as an opportunity to better serve our users. We work with OEMs in two technology modes. We either use the OEM’s Device Management software or we enable OEMs to use PayJoy Access. Access makes devices ready for PayJoy Lock-style financing when an OEM does not have the required Device Management software in place.

Consider Device Management mode. On Samsung phones, we use Samsung’s Knox Platform for Enterprise (KPE), a mature platform with extensive privacy controls. It also enforces added user transparency. Users clearly see the level of device controls and access required for the PayJoy software to run successfully. Once the term of the loan is completed, PayJoy gives up all control of the device.

Using PayJoy Access, OEMs update the phone’s firmware to ensure secure provisioning and activation of the PayJoy Lock. These updates prevent malicious parties from “breaking the lock” by disabling or removing the PayJoy software. It is important for the OEM to be fully aware of what the PayJoy software is doing and what access it has. To support this, PayJoy uses an open communication process to collaborate with OEMs. Specifically, PayJoy shares source code, design, and test documentation to help OEMs validate their implementation, as well as to understand PayJoy’s design. Our OEM partners such as d.light perform significant testing in-region to ensure that the Lock behaves optimally from the perspective of privacy and viability for consumer finance.

Finally, all devices that implement PayJoy Access pass Google’s Compatibility Test Suite (CTS), an industry expectation for Android devices. CTS covers OEM firmware including the OEM’s PayJoy Access implementations.

This then completes the cycle of designing and implementing privacy for our users. Through our use of leading off-the-shelf technology, open internet protocols, layered security and transparent OEM collaboration, PayJoy has worked to ensure the right balance of user privacy and a viable financing model. 

The Road Ahead:  We will continue our commitment to enhancing user privacy as we innovate with our financing model. Our plans include increased support for Data Location as these requirements get clarified by governments in our target markets. In addition, we will continue to take advantage of underlying platform improvements. For instance, we will fully support Android 11’s improved privacy controls. Finally, we will continue to experiment with requiring lighter device controls but serve our users in emerging markets with much-needed credit. 

Pilot our Lock without developers…and a new look for Lock Dashboard

We absolutely encourage prospective PayJoy clients to pilot the PayJoy Lock with our 30 day unlimited activations free trial before making the technical investment to integrate with Lock API.  To make pilots faster to deploy, we’ve built a bulk upload feature that enables clients to remotely update Locks across their customers’ devices via csv upload.  You can update up to 5,000 locked devices at once with no engineering work needed. 

What’s next

We’ve launched Bulk Upload to everyone with the following features built so far:

  • Activate Locks
  • Update your customer’s expiration when they’ve made a payment
  • Set Locks to inactive and removable if your customer’s loan is complete

We’re going to keep rolling out more Bulk Upload features to have parity with our Lock API.  By the end of December 2019, you will be able to, without any engineering, be able to make the following changes to your customers’ Locks: 

  • See all of the bulk upload csv files you’ve submitted to audit your changes (coming soon!)
  • Pre-claim 
  • Change phone and SIM numbers
  • Get an offline code to send to your customer if they don’t have internet connectivity to make sure their Lock date is extended

A new look for Dashboard

We coincided building the bulk update feature with a new UI refresh of our Lock Dashboard.  We designed the Dashboard to be cleaner, more user-centric for you to try out the Lock on your own and set up a pilot with your team, and easier to customize your Lock app with your own logo, and set up team permissions.  Sign up or log in to take a tour! 

Try out the Lock for free

It is now easier than ever to take advantage of our 30 day free trial, and then upgrade by purchasing one of our Lock bundles. If you’re a lender in an emerging market interested in securing your customers’ loans with smartphones using the PayJoy Lock, start a pilot with us today.

Lanzamientos: Haz pruebas piloto con nuestros desarrolladores 

Alentamos a nuestros clientes prospecto que realicen experimentos con nuestra prueba gratuita de 30 días antes de realizar una inversión para integar nuestra API de Lock a su sistema.
Para hacer el despliegue de las pruebas piloto más rápido, hemos desarrollado la funcionalidad de carga múltiple, que permite actualizar los Locks de sus clientes de manera remota con un archivo csv. Es posible actualizar unos 5,000 dispositvos de una vez sin trabajo de ingeniería. 

Un recorrido de la funcionalidad: 

Qué sigue: 

Hemos lanzado la Carga Múltiple para todos nuestros clientes con las siguientes capacidades: 

Implementaremos más funciones de Carga Múltiple para estar en sincronía con nuestra API de Lock. Hacia el fin de diciembre de 2019, ustedes serán capaces de – si ayuda de ingenieros, hacer los siguientes cambios a los Locks de sus clientes: 

  • Ver todas las cargas de archivos CSV que se han realizado para auditar cambios 
  • Cambiar números telefónicos y de SIM
  • Apartar el IMEI de los teléfonos que aprovisionarán con un Lock
  • Generar un código offline para enviar a tu cliente en caso de que no tengan conexión y poder extender el plazo de su Lock
  • Activar Locks
  • Actualizar la fecha de expiración de sus clientes una vez que han realizado un pago
  • Modificar el estado del Lock a Inactivo o Removible una vez que el financiamiento de su cliente ha concluido

El dashboard estrena look

Hemos hecho coincidir la funcionalidad de carga múltiple con con una nueva Interfaz de Usuario para el Dashboard de nuestro Lock. Diseñamos el tablero para ser más ordenado y centrado en el usuario para que realicen pruebas piloto, personalicen su App de Lock con su Logo y configuren los permisos de su equipo. Regístrese o acceda aquí para tomar un tour. 

Pruebe el Lock si costo

Es más sencillo que nunca aprovechar nuesra prueba gratuita de 30 días y posteriormente adquirir uno de nuestros paqutes de Lock. Si es un acredor en un mercado emergente interesado en asegurar los préstamos de sus clientes a través de su smartphone, realice una prueba piloto hoy mismo haciendo clic aquí

Cerrando la brecha crediticia con el “Score” de PayJoy

English

Evaluación crediticia para la era móvil

PayJoy ofrece evaluación crediticia de clase mundial. Hemos desarrollado una plataforma de evaluación basada en los datos del celular y la integramos a nuestra aplicación; a este nuevo producto lo hemos llamado “Score”.

Score ha reducido los impagos de nuestros clientes de teléfonos financiados y de préstamos personales en un 50% y sumada a nuestro Lock, hemos disminuido los impagos entre clientes sin cuentas de banco en un 60%; lo que significa que vastas cantidades de clientes que previamente no hubieran podido ser atendidos de manera digital, ahora son sujetos a servicios financieros y créditos digitales con atractivos márgenes. Nuestros resultados iniciales muestran que Score es 3 veces más fuerte que las calificaciones de crédito actuales. Estamos muy entusiasmados por que esto creará un nuevo camino a la inclusión financiera para miles de millones de clientes que están fuera del sistema financiero existente.

Trabajar a la par con Score y Lock es posible para cualquier cliente con un teléfono inteligente, con la suma de ambos productos es posible atender a los usuarios incluso si no cuentan con un historial crediticio o cuenta de banco. El Score de PayJoy está listo para implementarse en México; puede encontrar toda la documentación aquí. Tenemos acuerdos comerciales en muchos de los países en los que operamos para obtener datos y crear una calificación crediticia; estamos trabajando para ofrecer el producto en todos los lugares en los que operamos con la colaboración y consentimiento de nuestros socios y clientes.  

Tres ejemplos reales de Score

Ejemplo 1. Vender un teléfono a crédito

  1. El vendedor de mostrador descarga la app de PayJoy en el teléfono del cliente
  2. Tu sistema POS obtiene de nuestro Score la calificación crediticia, generada a partir de los datos del dispositivo; se le explican los términos de la oferta al cliente
  3. La app de PayJoy se instala en el teléfono que será adquirido, se cierra la venta y el cliente sale con un teléfono nuevo. El desarrollo de PayJoy te recordará los periodos de pago del cliente y te ayudará a asegurarlos en caso de morosidad

Ejemplo 2. Préstamos en efectivo de una casa de empeño

  1. El vendedor de mostrador descarga la app de PayJoy en el teléfono del cliente
  2. El vendedor accede a la página web de PayJoy para determinar la calificación crediticia y en caso de ser aprobado, comunicarle al cliente los términos de la oferta
  3. Se realiza el préstamo y el cliente sale de la tienda con su teléfono y el empréstito, quedando en garantía la funcionalidad del dispositivo; el software de PayJoy será utilizado para limitar el funcionamiento del Smartphone en caso de morosidad o impago.

Ejemplo 3.  Préstamos en efectivo desde una app móvil

  1. El cliente solicita un préstamo a través de tu aplicación móvil
  2. Tu aplicación descarga en el teléfono del cliente la API de PayJoy y ésta obtiene la calificación crediticia, comunicándole al usuario los términos de la oferta a través de tu interfaz
  3. El préstamo es otorgado al cliente ya sea a través de un movimiento bancario, o por retiro sin tarjeta en un cajero automático. El Lock de PayJoy será utilizado para limitar el funcionamiento del Smartphone en caso de morosidad o impago

¿Cómo se ve un Score de PayJoy?

Nuestra calificación crediticia es representada con un puntaje entre 250 y 850, así como 5 características adicionales para que nuestros aliados puedan otorgar mejores condiciones a sus clientes. Los detalles los puedes encontrar en la documentación de la API de Score. Estamos seguros de que nuestros Score y Lock permitirán a nuestros socios comerciales determinar la disposición y habilidad de pago de sus clientes, cosa que hasta ahora, era imposible.  

Qué hace al Score de PayJoy único

Score permite bancarizar a quienes no tienen acceso a dichos servicios

Nuestro Score funciona para los individuos que no cuentan con historial crediticio (25% de nuestros clientes en México no tienen antecedentes de crédito*), sin cuenta bancaria (45% de nuestros clientes en México no tienen una*) y sin contar con negocio propio (84% de nuestros clientes en México son empleados públicos, privados o forman parte de la economía informal).

Los acreedores utilizan Score para determinar de manera óptima qué prestar y cómo hacerlo basados en la calificación crediticia, mientras que el Lock permite la colateralización del teléfono del cliente durante el periodo de pago. Estos productos juntos ofrecen de manera incomparable la capacidad de prestar utilizando dispositivos móviles, lo cual es crítico, considerando que casi ¾ partes de los 710 millones de personas con posibilidad de suscribirse por primera vez a servicios móviles serán de las regiones Asia-Pacífico y África subsahariana. Además, 1,400 millones de personas comenzarán a usar internet móvil por vez primera, con un gran total de 9,200 millones de conexiones a través de SIM hacia el año 2025.

Score predice hasta con tres veces mayor precisión que la calificación de un buró de crédito


A pesar de que los datos en México incluyen microfinanciamientos, nuestro Score arroja tres veces más predicciones cuando se comparan a los mismos prestatarios lado a lado.

¿Cómo puedo obtener Score?

Nos da gusto que preguntes. Hemos hecho accesible este producto a algunos socios comerciales, sólo haz clic en el botón “Asóciate con Nosotros” en nuestra página de internet.

Fuentes

GSMA Association. (2019). The Mobile Economy 2019 [PDF File]. Retrieved from https://www.gsmaintelligence.com/research/?file=b9a6e6202ee1d5f787cfebb95d3639c5&download

* Reportadas por los clientes

Bridging the credit gap with PayJoy’s ‘Score’

Español

Credit scoring for the mobile age

PayJoy now provides world-class credit scoring. We have launched a credit score based on smartphone data and integrated it into our app; we call this new product Score. Score reduces defaults on our own consumer phone-purchase and cash-loan portfolios by up to 50%. In combination with Lock we have seen default rates for unbanked consumers drop by 60% which means large populations of consumers that could not be served digitally and at scale can now profitably be offered digital credit and financial services.  Our initial results show that the PayJoy Score is 3x stronger than existing credit scores. We’re optimistic that this will provide a new path for financial inclusion for billions of consumers who are financially excluded from existing credit systems.


Score + Lock can work for any consumer with a smartphone. With Score + Lock you can serve your users even if they have no credit history, no bank account, and no business ownership. PayJoy Score is now ready for use in Mexico with full documentation here. We have in-place agreements in multiple geographies to gather data to build out a score. Ultimately, we plan to offer Score in every geography where our clients operate. All of this will happen with the consent of the consumers and partners.

3 real-life examples of Score

Example 1 – Selling a new phone on credit

  1. Your store clerk downloads the PayJoy app on a consumer’s existing smartphone.
  2. Your store’s point-of-sale retrieves the device’s credit score from Score API and you communicate to the customer the terms of their offer.
  3. The PayJoy app is downloaded onto the phone being purchased, the sale is completed, and the customer leaves with a new phone. PayJoy’s Lock technology is used by you to remind the borrower about payment cycles and to help secure payment in the event of default.

Example 2 – Cash loans from a physical store, like a pawn shop

  1. Your store clerk downloads the PayJoy app on a consumer’s existing phone.
  2. Your store clerk uses their PayJoy website account to view your score details, the consumer is approved and you communicate the terms of the offer to the consumer.
  3.  You complete the loan and the consumer walks out of the store with a usable phone and cash loan that is using their phone as equity. PayJoy’s Lock technology is used by you to lock/unlock the phone according to repayment.

Example 3 – Cash loans from your mobile app

  1. A consumer applies for a loan through your mobile app.
  2. Your app automatically downloads PayJoy’s app onto the consumer’s phone, retrieves Score from the Score API, and your app displays the terms of the consumer’s final offer.
  3. Cash is dispensed to the customer, either to their bank account directly or as a 1-time ATM withdrawal for the unbanked. PayJoy’s Lock technology is used to lock/unlock the phone according to repayment.

What exactly does a PayJoy Score look like?

Score currently delivers a 250-850 credit score as well as 5 additional credit features that clients can use to make better credit decisions for unbanked consumers that have a smartphone. All of these details are explained in our Score API documentation. We believe that Score and Lock enable our clients to determine willingness and ability to pay for consumers where that is currently not possible today.

What makes PayJoy Score unique?

Score makes the unbanked bankable.

Score performs for individuals with no credit history (25% of our MX portfolio have no credit history*), no bank account (45% of our MX portfolio have no bank account*), and no existing business ownership (84% of our MX portfolio are employed by the private sector, public sector, or informal economy*).

Lenders use Score to optimally decide who to lend to and how at the point of underwriting, while the Lock product enables the collateralization of the borrower’s phone during repayment. These two products together provide unparalleled ability to lend using mobile devices – critical considering that almost ¾ of the 710M people expected to subscribe to mobile services for the first time over the next 7 years will come from the Asia Pacific and Sub-Saharan African regions, with an additional 1.4B people starting to use mobile internet and for the first time and a total of 9.2B SIM connections by 2025.¹

Score is 3x as predictive as a Credit Bureau score

Although Mexico’s credit data includes microfinance data, our smartphone based score still yields 3x the predictive power when compared side by side for the same borrowers.

How do I get the Score ?

We’re glad you asked!  We’re making this available to select beta partners at this point. Just click the “Partner With Us” button on our home page.

Sources

  1. GSMA Association. (2019).  The Mobile Economy 2019 [PDF File]. Retrieved from  https://www.gsmaintelligence.com/research/?file=b9a6e6202ee1d5f787cfebb95d3639c5&download

*customer reported

Lock’s new Unlock Offline feature for users with limited internet connectivity

By Chris Moore, Nam Pham, Mauricio Castaneda, Dominique Friedl, Jenny Jin

In rural areas in Africa and Indonesia, our users who are financing a smartphone with the PayJoy Lock might experience a poor user experience if they are not able to update their device once they’ve made a payment due to lack of 3G/4G/LTE network coverage.  

This will differ from country to country but some of our clients estimate that 70% of their customers live in rural areas with poor connectivity. In GSMA’s 2018 Mobile Connectivity World Index, most of the markets that PayJoy operates in LatAm, Africa, India, and Southeast Asia have low to medium LTE coverage at best.  

Introducing Unlock Offline

Our new Unlock Offline feature allows users to enter a code into the PayJoy app that will update their amount of credit and keep their phone from locking, no internet necessary. This feature is core to our social mission of enabling the world’s underbanked to access credit by designing with their contexts in mind.  

A quick overview of the Unlock Offline feature

1) Via Lock API, a PayJoy partner requests a code for a customer who is currently offline.

2) The client sends the generated code to the user by a phone call, SMS, or other user-accessible way.  

3) After receiving the code, the user enters it in the following dialogue box that appears in their PayJoy app’s home screen when we detect that the phone is offline.  

For security measures, we accept 5 attempts daily per user’s device and will monitor any suspicious fraud activities.   

Interested in enabling this feature for your customers?  

This feature is currently in beta in East Africa. If you are interested in this feature as a PayJoy client in your market, please contact us at locksupport@payjoy.zendesk.com.

Baobab+ Unleashing the Potential of Senegal with PAYG Smartphone.

Baobab+ a subsidiary of Baobab Group, is a leader in digital and financial inclusion and is a social business committed to providing access to energy and digital. Baobab+ commercialize innovative products with financing solutions that meet the needs of local populations in Africa. In partnership with PayJoy, Baobab+ is now unleashing the potential of Senegal by making incredible Smartphones accessible through a PAYG offer which now makes Smartphones accessible to all.

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For more information on PayJoy, visit www.payjoy.com. Join the smartphone financing conversation by visiting the PayJoy blog, Twitter, LinkedIn and Facebook pages.

For more information on Baobab+, visit https://www.en.baobabplus.com and Facebook pages.

Enabling Powerful Smartphone Subsidies

India’s feature phone shipments grew faster than smartphone shipments for the very first-time in 2018 thanks in part to an innovative finance program

According to the latest research from Counterpoint’s Market Monitor service, in 2018, India’s overall mobile phone shipments grew 11% and smartphone shipments grew 10% with feature phones growing faster than smartphones (11%) during the year for the first time ever, driven by the Jio Phone. Reliance Jio was the overall market leader across all handset types in 2018, with a market share of 21% and captured 38% of the feature phone segment in just over a year with its compelling value proposition compared to normal 2G feature phones. This was also recently covered in the WSJ.

Source: Counterpoint Research Market Monitor 2018

Reliance Jio’s compelling value proposition

The JioPhone was launched in July 2017 by the Indian mobile network operator Reliance Jio and was the first affordable 4G VoLTE smart feature phone, powered by KaiOS. The JioPhone, introduced as “India ka Smartphone” was launched at a so called “effective price” of Rs. 0 ($0). However, this was not exactly true. Consumers had to pay a security deposit of Rs 1,500 ($21.60) which was refundable if they returned the phone in 3 years and only if they paid for a Reliance Jio plan during the 3 years. Total cost to the consumer was Rs 6,000 ($86.40) or Rs 4,500 ($64.80) if the device was returned so certainly not free! Reliance Jio has certainly created a compelling value proposition that has been profitable for the company and gotten consumers access to the products they want. According to Counterpoint, half of the more than 100 million subscribers added since the launch of the JioPhone was thanks to this feature phone. Reliance Jio has changed the mobile economy in India by essentially creating a Post-Paid for Pre-Paid plan that tied customer loyalty to the mobile network operator.

The challenge in extending credit in emerging markets

The fundamental challenge mobile network operators or any company for that matter has in extending credit in emerging markets to purchase a smartphone – is the lack of collateral and underwriting data which is why Reliance Jio requires a security deposit and offers the lowest cost 4G handset possible. Mobile network operators would do better if they were able to find a way for consumers to pledge their smartphone as collateral. This would allow mobile network operators to offer better smartphones with little or no security deposit or perhaps even subsidized if the consumer agreed to a minimum mobile service recharge rate per year.

Extending credit by leveraging innovative technologies

PayJoy gives mobile network operators and finance companies a tool to collateralize smartphones that aren’t just the lowest cost phones. With our patented Lock technology, which resists any efforts to be deleted from the mobile device until the subsidy is recovered, we can increase recharge repayments and minimize the risk of late or defaults. We have developed a user experience on our lock that helps customers to track and make their recharge payments seamlessly via the app. When users are late on a recharge payment, they don’t get charged any late fees. Instead the PayJoy Lock limits their app and call functionalities until they make their recharge payment, and instantly restores normal phone functionalities. Through this new “Recharge” form of device subsidy that mirrors the “pay as you go” solar distribution model, we enable users to afford getting a smartphone by using it as collateral, and we enable operators to onboard the next billion users to smartphones and full connectivity.

A New Model Powered by PayJoy

Below is a sample of the kind of model that could be powered by the PayJoy Lock.

5.5″ Full View display
5MP rear camera, 5MP Front Camera
1GB RAM, Quad-Core Processor
Android™ 8.1 (Go edition)
Standard unlocked price: $80
PayJoy Locked price: $30
Recharge: $4.5/1.5GB for 12 months

For more information, visit www.payjoy.com. Join the smartphone financing conversation by visiting the PayJoy blog, Twitter, LinkedIn and Facebook pages.

Written by Dominique Friedl, GM PayJoy Africa and Jenny Jin, Senior Product Manager

PayJoy Gets an Astounding 80 NPS in Mexico

A Net Promoter Score (NPS) helps companies measure customer satisfaction. The proponents of NPS argue that NPS is directly related to revenue growth and profitability. Considering that keeping existing customers is 25 times cheaper than getting new ones, maintaining an above industry average NPS is indispensable to sustained growth.


PayJoy Mexico — where unlike our other markets we originate on our own balance sheet — carried out an SMS campaign last week among 5,000 randomly selected customers who used us for smartphone financing in the past 12 months. We asked a simple question:  “Based on your experience with us, from 0 to 10, how likely are you to recommend PayJoy?” We received 396 responses and calculated our score from there.  You can see the details of our methodology and results below:

Methodology: 

  • From all customers that had purchased a smartphone using PayJoy, the company randomly selected 5,000 of them.
  • The company asked: Based on your experience with us, from 0 to 10, how likely are you to recommend PayJoy?” 
  • Out of 5,000 randomly selected customers, 53 were no longer in service.
    From those 4,947, we received 396 answers and 41 were not considered due to lack or invalid response, mostly, non-numeric responses.
  • 10 and 9 were considered promoters, 8 and 7 passive and 6 to 0 detractors.
  • The calculation was: Promoters (as a % of total) – Demoters (as a % of total) x 100.
  • If the response was not 0 to10 the answer was not considered (51)
  • Conclusion: Based on our sample and the responses we received “we are 96% confident that our NPS of 80 represents the true population mean (for customers that obtained a smartphone finance by PayJoy).

The final NPS calculated — 80 –means customer satisfaction is considered, by many, world class.  As a benchmark, in Mexico, financial services averages an NPS of 46, while Telecommunications averages 24 and banking averages 37 per CustomerGauge.  83% of people trust recommendations from people in their inner circle per Nielsen, so this also contributes significantly to PayJoy’s growth.

PayJoy’s mission is to provide access to consumer finance to the next billion people worldwide. Mexico, as its first international market and the only one where it originates on its balance sheet, is key to enable PayJoy’s mission since it spearheads initiatives to ensure the products can be launched elsewhere worldwide.

We are very excited to know our customers are happy with our solution. That being said, we are continuing to work on many initiatives to improve our customer experience and give our customers more access to financial products” said Juan Jose Ocariz, PayJoy’s Mexico Country Manager. 

PayJoy Lock lifecycle end to end

By Jaideep Mirchandani and Dominique Friedl

In previous PayJoy blog posts, we highlighted the problem in lending to the underbanked and underserved and how PayJoy technologies are now helping to solve this problem.

In this post, we’ll talk about how Lock and Access come together to serve these underbanked and underserved consumers. We’ll give an example of how this has worked with a partner in Africa who has a truly end to end integrated consumer journey.

A lifecycle view to enable device financing

Let’s start with the consumer. Once the consumers’ ability to pay has been assessed and they have been approved for a phone on finance (installments), the PayJoy Lock app is installed on their new device, typically by a store clerk. To enable and activate the financing and credit lifecycle, the Finance Partner configures and manages the financed device using the PayJoy Lock API service.

A critical feature of the PayJoy Lock is ensuring that the Lock is secure so that phone finance is both practically and economically viable for the partner, meaning the partner is comfortable that the Lock is easy to set up, works reliably and fosters a strong repayment behaviour. This ultimately starts with the device manufacturer (OEM). OEMs either have built-in device management or they use PayJoy Access to make setup as secure and simple as possible. Briefly, Access is PayJoy’s firmware product which OEMs optionally use to enable automatic setup (“provisioning”) and device management to enable PayJoy’s Lock to work “out of the box” to minimize the number of steps for the user and store clerk to get started. There is a tradeoff between using PayJoy Access and OEM device management. Access is built from the ground-up for phone financing, meaning that it minimizes the number of steps during setup and can provide added security guarantees but the OEM is also required to integrate into their manufacturing processes. To make this step easier, we partnered with key mobile SOC partners like Qualcomm to offer faster integration of PayJoy Access for differentiated devices with improved time to commercialization.

The Lock lifecycle

After the capabilities are baked-into the device, PayJoy’s Lock API enables the finance partner to fully implement the lifecycle to serve the consumer. Deployment of the PayJoy Lock API at scale requires the partner to integrate the Lock into the partner’s business systems which may require additional considerations and setup. Here, PayJoy, provides an end-to-end launch process to help guide a partner’s technical team to integrate and launch Lock API effectively and efficiently.

Functionally, the API allows partners to:

  • Register and take ownership of a device
  • Lock a device at a particular time if payment is not made
  • Permanently unlock a device after it is fully paid

Partners call the PayJoy Lock API to control specific devices; these changes are then propagated from PayJoy servers to the device asynchronously.

Disclosures and Consumer Privacy

We realise that protecting consumer privacy is crucial. At each step of the way, the user is informed and requested for consent both by the Store Clerk but also by the PayJoy software. Just like all Android smartphone apps, Payjoy adheres to the Android permissions model to ensure transparency and customer controls.

Making it easy to customize the PayJoy app experience

Using the Lock API Dashboard a partner can customize the following features of the Lock without any code needed:

  • In-app personalized company logo
  • Whitelisted numbers that users can access (such as Customer Support) when their Lock is enforced
  • Whitelisted apps that users can access when their Lock is enforced
  • Whitelisted IPs for direct server to server API calls
  • Payment Page URL which can embed the partner’s payment page so users can pay directly

A case study – d.light in Africa

Recently, d.light, a global leader and pioneer in delivering affordable solar-powered solutions saw the opportunity to leverage its leadership in PAYG solar and offer smartphones on a pay-as-you-go basis. With d.light’s proven ability to finance and distribute devices, they implemented PayJoy “soup to nuts” to ensure the most secure and most streamlined experience possible for their consumers and merchants.

Specifically, they:

  • Preloaded app – Simple, secure setup using PayJoy Access with a pre-loaded PayJoy Lock. This minimizes data downloads for the consumer and makes the setup process smooth.
  • Ensured commercial-grade Android compliance – d.light devices have successfully passed Google’s Android Compatibility Test Suite (“CTS”), meaning that it is certified as “commercial-grade” per the CTS website.
  • Successfully integrated Lock into the point of sale and financing lifecycle – They successfully used PayJoy Lock API to implement point of sale and setup. This minimizes the number of steps for their store clerks and users in the store, which means fewer errors and a more satisfied user.
  • Successfully integrated Mobile Money to manage devices through the financing and credit lifecycle.

Initial results are positive and as such d.light are rolling out more broadly across the market. Along with the above, strong technical foundation, d.light will deploy their proven team of sales clerks and customer support staff to successfully support consumers with smartphone finance.

We look forward to many satisfied users benefiting from this joint ecosystem effort!

For more information, visit www.payjoy.com. Join the smartphone financing conversation by visiting the PayJoy blog, Twitter, LinkedIn and Facebook pages.