SmartCash, the mobile banking arm of Airtel Nigeria, has teamed up with Leadway Assurance to make car insurance accessible for motorists.
The partnership allows drivers to buy third-party car insurance directly from their phones, either through the SmartCash app or by dialing *939#. The plans start from ₦15,000 ($9.73), and the whole process takes less than three minutes. With these insurance plans, motorists get premiums on their cars to offset costs in cases of damage.
It’s a smart move for SmartCash, which operates under a Payment Service Bank (PSB) licence. In Nigeria, PSBs are not allowed to offer insurance, loans, or FX directly. So, teaming up with Leadway allows Airtel to deliver extra value to its customers without breaking the rules.
The move also ties in with similar “super-app” moves by other fintech arms operated by telcos. For example, Kenya’s Safaricom offers insurance plans to its M-Pesa users through Bima, after receiving approval to launch the product in November 2024.
These telecom companies are getting creative in the way they bundle financial services. Mobile money, airtime, credit, and other lifestyle value-added services—and that’s the point. It’s a way to attract customers.
Yet, in Nigeria where mobile money adoption is still struggling—unlike Kenya and Uganda—microinsurance is even worse. There’s an inside joke that if you sell insurance in Africa, your competition is God himself; perhaps, this is more true for Nigerians than the rest of the continent. Only 3.11 million vehicles out of over 14 million registered cars in Nigeria are insured.
Partnering with Leadway and removing the regulatory barrier is one thing. But creating the buzz around its car insurance service is what will determine if Airtel won’t kill this product in the next 5 years.
Competitively, SmartCash is entering a first-mover market among telcos. However, there are already several micro-insurtech companies selling different car insurance pitches to customers, like ETAP Insure and Pay-U. SmartCash has to find a way to entrench itself in this market, and tapping into its wide telecom subscriber base is one way to start.
