Electric motorbikes on credit: the warning comes every day, not every quarter
Bboxx Ride financed electric motorbikes for riders in Rwanda, and only in Rwanda. 113 motorbikes, 94 % repayment, more than 5 million kilometres. The business was judged on one number, repayment at three months.
That number is the right one for a credit committee. It is the wrong one for the people who have to act, because by the time it moves, the damage is done.
The signal came before the default
A rider buys energy every day. When that daily purchase starts to fall, repayment falls after it. The daily drop showed up first.
So the two numbers did different jobs. Repayment at three months judged the model. The daily purchase told us whom to call this week.
Ranking agents on repayment changed who they sold to
Once agents were ranked on the three-month repayment of their own riders, they changed the questions they asked before the sale. Which meant they changed the customers they chose.
That is the real effect of an incentive. It does not only reward a result, it reshapes the selection upstream. Volume then had to be won back through the quality of the portfolio, not around it.
What marketing does in a credit business
The plan for January 2024 aimed at 200 motorbikes with a campaign budget of 3,500 dollars. The campaign was the easy part. The question that mattered was which riders it would bring, and whether they would still be paying in month three.
In an asset financed on credit, a motorbike, a solar kit or a phone, the sale is a loan. Marketing that counts sales and ignores repayment is measuring the cost of its future defaults.
If you finance an asset
I recommend three moves. Find the daily behaviour that moves before repayment does. Put it in front of the people who sell, not only in front of the people who lend. And judge your campaigns on the repayment of the customers they brought, not on the number of contracts signed.
Going further: when your customer owes you money, marketing changes its metric, and the case study when the best seller is the worst for cash.
Are your campaigns judged on contracts signed or on repayment? Request a Growth Audit
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