Imagine you own five acres of land in a fertile region. You plant spinach, onions and tomatoes. Or, you rear pigs and chicken. After some months you are ready to supply your produce to a market. You need a proper means of transport. But which route do you take? Do you hire one, or simply buy?
A car is a costly asset that an individual or a corporate entity would decide on. It is at the back of this that Co-operative Bank entered into a partnership with Toyota Kenya, a move that will enable the bank’s customers to purchase commercial and personal vehicles under Toyota Kenya’s portfolio, including Toyota, Suzuki and Hino. This will also extend to those who are interested in Yamaha motorcycles.
Knowledgeable investors prefer going for strategic financing options and partnerships that are flexible and do not leave one broke. In an effort to spur business take off and growth from the adverse negative impact of the Covid-19 pandemic on the economy, Co-operative Bank will also extend a Sh500, 000 working capital loan without additional security to the successful applicants of the Toyota Vehicles in addition to providing a two-month (60 days) grace period. This is on top of up to 95% financing towards the acquisition of the vehicles, payable within 60 months. Toyota Kenya managing director, Arvinder Reel, in lauding the deal says that the pandemic demonstrated the need to support individuals and sectors that are at the heart of the country’s economy with flexible options to acquire key assets for their operations.
“Our partnership with Co-operative Bank goes beyond just the sale of the vehicles,” says Reel. “We are saying this is an improved partnership since customers will also receive professional training for their drivers under the Toyota Advanced Driving programme and the Yamaha Riding Academy, for those who purchase the Yamaha motorbikes. From our line up of quality, durable and reliable commercial and passenger vehicles, Toyota Kenya shall continue prioritizing solutions that support Kenyans towards their personal and business re-building in the wake of the pandemic.”
The partnership, which also allows fleet customers of Co-op Bank Fleet Africa Leasing Ltd, leasing arm of Co-operative Bank Group, to acquire more units, is expected to benefit mostly the tiny players who are generally unable to raise millions at once to purchase an asset. This is an amplification of the existing deal that only covers the commercial segment with the financing of the Hiace van and Hilux pickups.On her part, Co-operative Bank’s director of corporate and institutional banking, Jacquelyne Waithaka says that the scheme is available for those customers who want direct acquisition of the vehicle of choice or for leasing.
The bank has made the terms flexible to accommodate micro, small and medium-sized enterprises, co-operatives, corporate companies, individuals and farmers, even as the economy opens up. “The terms are attractive especially on the two months grace period,” Mrs Waithaka notes.Even after the lifting of the interest rate capping, the two firms have agreed to keep the borrowing rate at 13% per reducing balance. This also allows individual customers to purchase any Toyota Kenya models at a competitive rate.
