Jul 30 2016

TOKYO -- A Japanese used-car exporter aims to spur growth in the African market by introducing an auto loan service that offers easy approval but in exchange renders a car disabled should the owner fall into arrears.

Tokyo-based Agasta, a unit of Carchs Holdings, exports around 2,000 preowned vehicles a year to Africa and seeks to raise the figure by 1,000 in the first year of the new services debut.

Japanese used cars are popular in emerging markets because they are generally kept in good condition. But in Africa, many individuals are unable to get auto loan approvals, hindering market growth, according to Agasta. Strict screenings force many to pay cash.

The Japanese company will team with preowned-car sales companies and automobile financing providers to launch the new service. It is now in talks with four prospective partners in countries such as Tanzania and Kenya.