RateSetter has joined forces with giffgaff to offer a product which finances mobile handsets via peer-to-peer loans.
The union makes giffgaff the first mobile network to offer peer-to-peer lending to its members. The well-matched companies are both community-based and structured to avoid excessive costs.
Mike Fairman, CEO of giffgaff, said: “giffgaff and RateSetter partnering on our Handset offer makes perfect sense. We both share similar ideology and believe in new and innovative ways of doing business. This deal marks a watershed in both industries, with the new generation of businesses serving the new generation of members”.
A bespoke credit process has been devised by RateSetter for those purchasing mobile phones from giffgaff. That process combines RateSetter’s comprehensive credit checks with giffgaff’s premier anti-fraud tools. Giffgaff members will now be able to buy handsets financed by price-competitive RateSetter loans, and have total flexibility in deciding the amount they’d like to pay up front and how long they require to pay off the remainder of the loan.
A giffgaff spokesperson provided some insight into the mechanics of the new product: “Loan APRs will vary between 9-15% depending on individual circumstances and RateSetter will set the base rates to match the best market rates available to keep the borrowing proposition as simple, and cost-effective as possible”.
Rhydian Lewis, CEO of RateSetter, said: “We’ve never before offered direct loans for a single product like a mobile phone, and have spent months developing our systems to manage and mitigate risk in order to handle the increased number of borrowers expected to take out these new, smaller loans”.