While it was difficult for Cell C to make a profit with a mobile network, Blue Label prospered in the resale of airtime with a margin of about 7%. By 2015, according to a number of documents, 90% of all cell C sales were sold by Blue Label. Although one made a profit from these sales and the other a loss, their fortunes were deeply entangled. “We believe that [Blue Label`s] purchase of airtime from Cell C was intended to keep Cell C afloat,” CellSaf said of the transaction. While digital disruptions are entering all sectors and improving the lives of its customers, it is still far from having a significant impact on the financially marginalized population. According to the World Bank`s Findex database, about 2 billion adults worldwide are still understaffed. India has the second largest Unbanked population in the world, second only to China. The problem is not limited to developing countries. According to the U.S. Consumer Financial Protection Bureau, 45 million people in the United States do not have a credit history.
Credit reporting approaches that use alternative data from unconventional sources help people stranded outside the system build a credit history and access general financial resources. Such a form of financial service, which is gaining in popularity, is the credit of broadcast time. “We are therefore lowering our rating for Cell C to `SD` (selective default) of `CCC-` and our issue rating for the company`s priority secured debt securities to CCC`s CC,” said S-P. The downgrade follows changes to the payment plan for the private and unvalued 1.4 billion R1 Cell C agreement, which delayed some repayments, he said. The Agency called Cell C`s capital structure “unsustainable.” Because of their global presence, close customer relationships and access to extensive consumer data, MNOs have the ability to use their service platform to offer new products and services with credit-based assessment in time. As clients record and re-establish broadcast credits over time, they strengthen their credit profiles and improve their ability to access a wider range of financial services. The world`s largest telecommunications giant Telenor, for example, is using its data to develop predictive credit rating models and introduce new types of mobile credit products. These new products include, in addition to mobile money loans, emergency catch-up periods and handset financing.
The company also uses these credit cards to securely increase credit limits for postpaid customers or to convert a prepaid customer without a credit history into postpaid customers.