Driving Competition: Didi offers financial services for drivers in Brazil
China's ride-hailing giant Didi Chuxing has launched a program called "99-Cards" offering financial services for drivers in Brazil. Didi is hoping the move will boost its market share in a competitive ride-sharing sector in Brazil. That's as millions of people in the country have no access to bank accounts. How does this program work? Our Paulo Cabral explains.
A couple of years ago Jose Fernando da Silva lost his job and wanted to become a driver for a ride-sharing company. But he didn't have a bank account to receive his earnings. He wasn't alone. Tens of millions in Brazil don't use formal banking. And it was exactly this reality that prompted Chinese firm Didi Chuxing to launch a payment card for drivers to get people like Jose to join their local app, 99. Passenger fares are paid directly to the driver's card within one hour of a trip and the money can be used immediately to make purchases or pay bills.
JOSE FERNANDO DA SILVA DRIVER "I decided not to open an account because there are many bank fees to be paid besides the fee to the app itself. In the end, I would end up getting less money for my work."
PAULO CABRAL SAO PAULO "Offering financial services for drivers was a move by Chinese company Didi Chuxing - aiming to gain market share in a competitive ride-sharing sector in Brazil - where millions of people have no access to bank accounts."
Didi's 99 and Uber are the two key players in Brazil - also served by some other smaller companies. Both claim about 600 thousand drivers - but Uber reports 22 million customers while Didi's 99 says it has 18 million.
SIMENG WANG, DIRECTOR DIDI CHUXING BRAZIL "The competitor is very strong, to be honest. They are a truly respectable player in this industry but we truly believe we can offer a better solution and we can win in the long run. One example of local innovation is the 99Card we are doing."
"How was the 99Card received by the drivers? Did it work in your strategy?"
SIMENG WANG, DIRECTOR DIDI CHUXING BRAZIL "We know that our drivers they need really fast cash flow to pay the gas to work, to make groceries, to pay their bills. When we make surveys asking them what's the true differential of Didi's offering, 99 Card is always mentioned as one of the key innovation differences."
Didi's partner in the 99Card says working with people outside the banking system opens a large market in developing countries like Brazil.
PAULO FROSSARD, BUSINESS DEVELOPMENT VP MASTERCARD LATIN AMERICA "This partnership between Didi and Mastercard is innovative because it allows for the financial inclusion of millions of people who do not have access to the banking system. In Brazil, there are 60 million people who do not have bank accounts."
Brazil is the world's largest market for Didi outside China. And the company claims to have ambitious plans and innovative ideas to further strengthen its position in this key Latin American economy. Paulo Cabral, CGTN, Sau Paulo.