5 minutes, 17 seconds

25 November 2021

Rentoza launches pure subscription model, leans on Stitch to improve collections rate by 20%

by Thea Sokolowski, Head of Marketing & Communications​

Problem: Rentoza was validating customer identification and behavior manually and lacked data insights needed to quickly and accurately make an assessment. As a result, monthly collection rates were around 75%.

Solution: Today Rentoza uses Stitch to instantly access transaction insights and balance details directly from a potential customer’s bank account, allowing them to approve customers in less than 5 minutes.

Results: The team improved their monthly collections rate by 20%, to a near perfect rate (95%), and eliminated fraudulent documentation, improving their confidence in behavioral payment decisions and enabling them to move to a pure subscription model.

Enabling affordable and flexible access to essential technology in South Africa

Rentoza was born to enable everyone in South Africa to access essential technology that can improve their quality of life. It was launched by four friends and inspired by a personal challenge they all faced. The need for new technology – from the latest laptops and mobile phones, to gaming consoles and household appliances – is prolific, but many struggle to afford it and can be turned down by formal lenders. 

To solve this problem, the team launched a marketplace through which customers can easily access the latest products and pay on a monthly basis. According to Rentoza Co-Founder and CMO Mishaan Ratan, “We’re providing a new way of consumption. We allow people to access the latest technology at affordable rates – often at 10% the actual value of the item. Now people don’t have to worry about going to a bank and getting turned down for a loan.”

Rentoza Black Friday Stitch data

This week, the team is announcing a shift to a pure subscription model, enabling them to fully own the relationship with their customers and offer greater flexibility so anyone can access the tools they need. Today, customers can choose payment terms of one, three, six, 12, 18, or 24 months, depending on the product. With the new subscription model, they can also select a product and then choose to upgrade or downgrade however and whenever they want.

However, to get here, the team first needed to improve their collections rate and the effectiveness of their customer behavioral payment evaluation methods.

Stitch helps Rentoza improve collections and confidence in behavioral payment decisions

Rentoza’s differentiated approach lies in the fact that they’re not a credit provider. To evaluate potential customers, they instead leverage financial and social data to analyze customer behavior. With Stitch, they changed the way this process works. 

“We do behavioral analysis, not credit checks. We of course have verification parameters, but our goal is that anyone can come to us and get a product. Anyone can change the way they’re interacting with technology,” Ratan said. 

Previously, the team’s approach was rudimentary and manual. They asked potential customers for bank statements, proof of address, etc, which became very time-consuming and liable to fraud. As a result, they struggled to accurately assess potential customers. They saw monthly collection rates of 75% or less, and were responsible for the loss. 

After partnering with Stitch, Rentoza changed the way they evaluate potential customers. Now they can instantly access user financial data via their bank accounts to analyze their capacity to pay and confidently approve a customer in less than five minutes.

Today, following an ID check, potential customers link their bank accounts with Stitch, enabling Rentoza to instantly access 3 months’ worth of categorized bank statements. The team evaluates customers along 5-6 parameters, including:

  • Cash flow: total income coming in from all sources, and amount leaving  
  • Ability to pay: they look at all payments going in and out and identify outliers such as gambling or failed debit orders
  • Priority of payments: They try to understand how people value what they put their money toward. For instance, if they make rent and car payments consistently, but smaller things like leisure subscriptions are paid on and off, it shows they value the right things

Then they look at social media and occupational behavior. If approved, the customer is fully verified and moves into logistics and delivery to receive their item. All of this takes place in less than 5 minutes today, thanks to Stitch.

“Stitch has been very valuable because previously we had to ask for bank statements, which were often fraudulent. Now, because we’re pulling directly from users’ accounts, we know the information is valid. If someone can’t get their bank validated via Stitch, it’s an immediate no. This has allowed us to have more confidence that if someone is taking a subscription they’ll be able to pay it.”

This new way of assessing customers has enabled the team to achieve their target growth rate. They moved from a 75% monthly collection rate to 95% consistently, giving them the confidence to make the switch to a pure subscription model.

With this model, Rentoza owns all the items and allows people to subscribe to them for a given period of time. “This gives us the advantage of owning all the data and understanding consumer needs, and the ability to try things that we couldn’t do outside of previous ecosystems that were hamstrung by suppliers,” Ratan said. “I know we can change the market completely. There’s a massive need for it.”

The team has seen incredible growth, at 35% MoM growth for the last 15 months – moving from R8k (~$500) MRR to over R3.5M (~$224k) MRR today.

Rentoza’s impact

Thanks to their flexible model, Rentoza is able to reach multiple segments of South Africans across income brackets, enabling them to utilize their money in a better way. The monthly subscription fee is based on SKU, with a variety of products so customers can choose what they can afford to access. They can expose themselves to the best technology, and choose to return it if it’s not working for them.

“Previously someone would only be able to afford, say, a Dell laptop. Now, for R1000, they can get anything, up to a MacBook Pro. Those customers are then able to be more efficient and do work at a higher level, and therefore make more money off of these tools,” Ratan said.


We’re excited to see what’s next for the Rentoza team! Check out their site this week for the best Black Friday deals here. Learn more about how Stitch Data can enable you to transform your qualification processes and reach more customers here.

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