Platforms like M-Kopa, PayJoy, and FoneYam have redefined what it means to own a smartphone. Instead of requiring a full upfront payment, they offer affordable pay-as-you-go plans. Customers can repay weekly or monthly through mobile wallets, debit orders, or even airtime deductions.
The innovation lies in how these repayments are tracked. Increasingly, providers are reporting repayment behaviour to credit bureaus. This means that after 6–12 months of consistent payments, a customer not only keeps their phone but also establishes a verifiable credit history. That new credit profile can open the door to personal loans, retail accounts, and other forms of finance that were previously out of reach.
In a country where 15 million adults remain “credit invisible,” this shift is more than a convenience — it’s a direct pathway to economic inclusion. For example, a young entrepreneur in Limpopo could use M-Kopa to finance her first smartphone, then leverage that device to manage a small online shop. Her on-time repayments build her credit score, which later helps her qualify for a microloan to expand her business. Similarly, a teacher in KwaZulu-Natal could use PayJoy’s model to spread the cost of a device over 12 months, gaining both the technology she needs for remote learning tools and a stronger credit profile.
This growing movement means smartphone credit building in South Africa is no longer just a niche service — it’s becoming a mainstream entry point to the country’s financial system.
The potential is enormous. By tying technology access to credit history building, these programmes can empower individuals to pursue online education, run digital businesses, and engage with e-commerce platforms. They also enable access to services that require a credit profile, from renting an apartment to securing a vehicle loan.
However, there are risks that cannot be ignored. Many of these plans come with significant mark-ups — in some cases, customers may end up paying as much as 185% of the retail price for their device over the repayment period. While the weekly or monthly instalments appear manageable, missed payments can damage a customer’s credit score and may even lead to repossession of the device.
When managed well, smartphone credit building in South Africa can unlock life-changing opportunities for individuals and communities. But without strong consumer awareness, it can also trap vulnerable users in cycles of debt. Financial literacy is therefore critical, ensuring that customers understand the full cost of ownership and the importance of timely repayments.
While the National Credit Act was not originally designed for fintech-led rent-to-own or bundled service models, this gap presents an opportunity rather than an obstacle. By evolving regulations to reflect the realities of today’s digital economy, South Africa can position itself as a leader in inclusive, technology-driven finance.
The path forward lies in closer collaboration between regulators, consumer advocacy groups, and the fintech and mobile industry. Together, these stakeholders can create a framework that safeguards consumers while encouraging innovation to flourish. This means ensuring repayment-linked credit reporting is accurate, pricing is transparent, and customers are given the knowledge to manage their financial commitments successfully.
With the right checks and balances in place, smartphone credit building in South Africa can be scaled responsibly, reaching more communities, supporting entrepreneurship, and opening the door to wider financial opportunities. By pairing progressive policy with industry cooperation, South Africa can turn smartphones into powerful tools for lasting financial inclusion — empowering millions without exposing them to unnecessary risk.
