Guaranty Trust Bank has launched Hub Credit, a new quick loan scheme for its customers. This appears to be its first real shot at developing a holistic digital credit offering for its customers.
— Guaranty Trust (@gtbank) May 11, 2018
However, Hub Credit is not a full loan package. It only provides credit for GT Bank customers to complete transactions on its SME Market Hub eCommerce platform.
With the new feature, GTBank users can visit the SME Market Hub store and select items to buy. Hub Credit covers their cost, while the customer pays back later. Simple, right?
Hub Credit uses information about GTBank customers to determine their creditworthiness. Once determined, it can cover spendings up to one million naira.
#HubCredit provides you with a spending limit of up to ₦1,000,000 and a minimum of ₦20,000 to shop on @SMEMarketHub and payback within a period of 12 months or sooner (whichever works for you)
— Guaranty Trust (@gtbank) July 28, 2018
Here’s a full breakdown about how Hub Credit works.
- Hub Credit is available to GTBank customers only.
- Applicant must have received a minimum of ₦100,000 as salary in the last 3 months.
- Depending on the creditworthiness or rating, an applicant can borrow a maximum of one million naira and a minimum of 20,000.
- Applicant must not have a non-performing loan with the Bank.
- Applicant must not have adverse credit bureau report.
- Borrowing with Hub Credit comes with a steep 21% interest.
- All loans must be paid back under 12 months.
Is Hub Credit GT Bank’s Credit System?
Although not a full credit system, Credit Hub seems like GTBank’s closest publicly-announced attempt. But it falls short though, majorly because it is paired to work only with SME Market Hub.
GT bank disrupted banking, that's yesterday's paper anyway but this #Hubcredit is just a fantastic initiative for disrupting asset finance. How do they even do it?
— Tuff Guy (@T_WAYNE100) July 28, 2018
Meanwhile, start-ups like One Finance have developed impressive credit systems that customers can use anywhere. It just shows that banks continue to innovate slowly.
However, Hub Credit does appear to be an interesting system that could pave the way for things to come.
For instance, the feature has an interesting customer agreement. Customers must agree that the borrowing account is the same account used to receive salaries. So if a customer defaults on a credit loan, they can’t just run off and leave the system in jeopardy. The bank exerts the debt from the monthly salary of the client.
It’s still a long way from a full credit system, but it’s interesting to see a GTBank, a too-big-to-fail bank, delve into this.
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