MTN’s mobile money service, MoMo, in South Africa has unveiled plans to offer 4G and 5G smartphones on credit to prepaid customers without requiring background credit checks. The ‘Handset Rent-to-Own’ solution aims to encourage millions of South Africans to upgrade from older feature phones by making smartphones affordable and accessible.
Phones will be available through the MoMo app for as little as ZAR10 (approximately US$0.55) per day, with no paperwork or credit checks needed. Instead, the service leverages AI-driven affordability assessments to evaluate customers. The initial launch includes 4G Samsung smartphones, with additional brands to follow. Customers place orders via the MoMo app and pay a small deposit to start.
This program follows an earlier May launch where MTN offered smartphones for ZAR99 (around US$5.47). MTN CEO Charles Molapisi noted that while the network has about 85% smartphone penetration, five to six million users still lack smartphones, mainly due to affordability challenges.
South Africa plans to phase out 2G and 3G networks by December 31, 2027, which will render many low-income users’ phones obsolete. The government aims to reallocate radio frequencies for 4G LTE and 5G networks, intensifying the need for affordable smartphone access.
MTN’s initiative is a proactive step to bridge the digital divide, helping more South Africans stay connected as older technologies are retired.
