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United Bank for Africa (UBA) Plc has partnered with Mikano Motors to introduce a new vehicle financing programme aimed at making new cars more accessible to Nigerians facing rising vehicle acquisition costs.
The initiative, tagged “Drive Your Dream Today,” allows eligible customers to pay 30% of a vehicle’s cost upfront, while UBA finances the remaining 70%.
The financed portion can be repaid over 36 months at an interest rate of 23%, giving customers the option to spread the cost of vehicle ownership rather than meet the full purchase price at once.
30% Down Payment, 36-Month Repayment
The scheme was unveiled at the Mikano Motors showroom in Victoria Island, Lagos, as part of efforts by both companies to expand access to structured consumer credit.
Under the arrangement, customers who meet UBA’s eligibility requirements are expected to provide an initial 30% contribution. The bank then provides financing for the balance, which the customer repays through scheduled instalments over three years.
The structure is designed to lower the upfront financial barrier associated with buying a new vehicle, particularly at a time when the cost of new cars has increased significantly.
Salaried and Self-Employed Nigerians Can Apply
UBA said the financing is not restricted to people earning conventional monthly salaries.
Salaried workers, entrepreneurs, self-employed individuals and other eligible customers can access the scheme, subject to the bank’s assessment and approval.
The application process begins with an eligibility assessment through a UBA branch or the bank’s consumer-lending channel.
Once a customer receives approval, the next step is to obtain a proforma invoice from Mikano Motors for the preferred vehicle before completing the financing process.
UBA Links Auto Credit to Financial Inclusion
Speaking at the launch, Chidi Okpala, UBA’s Group Executive Director-designate, Personal and Business Banking, said the partnership reflects the bank’s broader effort to make important personal purchases more attainable through structured credit.
He said reducing the amount customers have to provide upfront could make vehicle ownership more achievable while also encouraging responsible borrowing and repayment.
The bank’s Group Head of Consumer Lending, Frank Okoh, said the arrangement was deliberately structured to accommodate customers with different income profiles.
According to him, prospective customers can begin with a straightforward eligibility check before proceeding to vehicle selection and financing.
Mikano Strengthens Ownership Package
For Mikano Motors, the partnership creates an opportunity to make its vehicles accessible to a broader pool of prospective buyers.
Tarek Mostafa, General Manager of Mikano Motors, said the company’s offering extends beyond vehicle sales to include after-sales support.
The company provides genuine spare parts, maintenance and servicing, allowing customers to access support after purchasing their vehicles.
Mikano said the financing partnership would therefore combine access to credit with its vehicle sales and after-sales infrastructure.
Rising Vehicle Costs Drive Financing Demand
The initiative comes against the backdrop of steep increases in the cost of new vehicles in Nigeria.
For many households and business owners, the upfront price of a new vehicle can represent a significant financial commitment. Financing arrangements such as the UBA-Mikano scheme shift a substantial portion of that burden into scheduled repayments.
The development also highlights the growing role of banks in providing consumer financing for assets that traditionally required buyers to rely heavily on personal savings.
A Push for Structured Consumer Credit
UBA’s partnership with Mikano comes as Nigerian lenders increasingly explore consumer lending as a way of expanding access to credit beyond conventional business loans.
By linking financing directly to vehicle purchases, the initiative gives customers a defined asset, repayment structure and purchase process.
For eligible Nigerians, the key attraction is the ability to finance 70% of the vehicle’s cost, rather than raising the entire purchase price before taking ownership.
The scheme nevertheless remains subject to UBA’s eligibility and credit-approval requirements.
As vehicle prices continue to put pressure on household and business budgets, partnerships between banks and automobile dealers could become increasingly important in expanding access to structured asset financing in Nigeria.
