Uber, an industry leader in the ride sharing industry, has recently paired up with SocietyOne, an online financial community of borrowers and investors. This partnership aims to provide Uber drivers, both current and potential, with loans to purchase new cars. Through doing so, there is an estimated increase in the number of Uber drivers available, as well as adding increased pressure on the taxi industry.
Through their involvement, SocietyOne will gain access to a wide, fast-growing market of potential borrowers. With only 18 months since its launch in Sydney, Uber already has approximately 20,000 drivers. With this partnership, there is a further increase of drivers expected as SocietyOne have noted that borrowers with good credit history can expect to borrow at lower interest rates than offered by larger financial institutions. At present, SocietyOne offers car loans at 6.45%, which is 1% cheaper than the best rate from the 4 major banks in Australia.
With a majority of Uber drivers driving on a flexible basis, with varied hours, the banks are unable to meet their needs for loans as they require built up credit profiles based around a 9-to-5 job. SocietyOne is able to meet the needs of this flexible working sector in a way which larger financial institutions are failing.
With the demands Uber makes regarding the vehicles used by drivers, such as that the car cannot be over 10 years old, and that it must be in excellent condition, it is highly likely that individuals will be needing to buy new vehicles. Uber released information which revealed between 10-15% of individuals hoping to become drivers failed as a result of their car being unsuitable.