What to ask a finance partner before you offer it to your drivers

Sooner or later, a driver in your car will need cash between payouts. Some owners lend it themselves. Some look the other way. More and more are pointing their drivers to a finance product, an app or a partner.

If you do that, your name is on it. When it goes well, your driver trusts you more. When it goes badly, it is your car standing while your driver sorts out a debt. So it is worth asking hard questions before you recommend anything.

The mistake to avoid

The mistake I see owners make is assuming every driver finance product is roughly the same, as long as it gets the driver cash when they need it.

It is not. The way a product is built decides what it does to your driver over the next six months. One that solves today's problem by adding a cost that grows can quietly destabilise a good driver. Look past 'does it work today' and ask 'what does this do to my drivers over time?'

Questions about cost

1. What does the driver pay back in total, in rands, for a given amount?
2. Is the cost a fixed amount, or does it grow the longer the money is owed?
3. Are there admin fees, penalties or other charges that are not in the headline price?
4. Can the loan be rolled over or extended, and what does that cost?

A fair product should answer all four in a sentence each. If the answer to the second or fourth question is 'it grows' or 'yes, for a fee', be careful. That is where drivers get stuck.

Questions about collection

1. How is the money collected: from earnings, or by debit order on the driver's bank account?
2. Does the timing match when the driver is actually paid?
3. What happens if the driver's earnings are short that week? Who contacts them, and how?
4. Does collection need any manual work from you or your team?

Done properly, a finance product should take work off your plate, not add to it. If a partner expects you to chase your drivers for repayments, that is the wrong partner.

Questions about the driver

1. Is the lender a registered credit provider?
2. Does the driver get a quotation and an agreement to read before they accept?
3. Is each request assessed, or is money handed out with no check on whether the driver can pay it back?
4. What happens to a driver's standing on the platform if a repayment is missed?

What good answers sound like

You do not need to be a finance expert to judge the answers. Listen for these:

• Cost: one total in rands for each amount, written down, with no extra fees that turn up later. For example, 'borrow R1 000, pay back R1 200', not 'a small monthly charge'.
• Term: short and fixed, with a clear end date. No rolling over and no extensions that restart the cost.
• Collection: matched to when the driver is paid, with no work for you or your team.
• Short weeks: the partner contacts the driver early and talks it through, instead of piling on penalties.
• Lender: a registered credit provider that assesses each request and gives the driver the agreement to read before they accept.

If a partner answers all of these clearly and without being pushed, that tells you a lot. If you have to drag each answer out of them, that tells you even more.

Before you recommend anything

Take these questions to any partner. Write down the answers. If you would not be happy borrowing on those terms yourself, do not point your driver there.