The dream of car ownership is often out of reach for many low-income individuals and other traditionally underserved groups in Brazil. Hurdles such as lack of minimum credit scores, proof of income, and high interest fees can restrict access to financial tools like automobile loans.
This can have a domino effect. For instance, sometimes no car means there is no way for someone to drive to, or for, a job, and could mean no way to transport one’s children to school, robbing them of access to mobility and opportunities.
Kovi, an auto financing company with a non-traditional approach, aims to change this reality. By offering cars via an affordable rent-to-own model, as well as monthly and annual pay-per-mile subscription plans, the company’s Founder and CEO Adhemar Milani Neto and Partner and Legal, Compliance, and Public Policy Officer Isabella Coutinho say they are helping enable on-demand workers gain access to a personal vehicle needed for employment, as well as improve their livelihoods and financial health.
Kovi runs an asset-light model by partnering with automakers and traditional car rental and leasing companies and subleasing them to drivers. The company uses proprietary technology to monitor vehicles and drivers in real-time, ensuring safety and performance, as well as the driver’s welfare. It also allows Kovi to block car usage if customers start to miss payments.
In Latin America, on-demand workers such as ride-hailing and food delivery drivers make three times the minimum wage but face the initial challenge of extremely high car ownership costs, Neto told UNSGSA Queen Máxima during her visit on 5 June 2023. He added that many people who want to be drivers or need access to a car to work come from underserved backgrounds with low or no credit scores.
41-year-old Luisa Pereira credits Kovi, and its financing model, with giving her a new lease on life. Two years ago, after a divorce and subsequent move (along with her teenage son) from the South Zone to the outskirts of the North Zone in São Paulo, Pereira's ex-husband took her previous car.
However, as a ride-hailing app driver for Uber and 99, Pereira needed a new automobile to get back on her feet. Kovi made this possible, she said, adding that it did not only help her with work, it helped as a woman to have autonomy and believe in herself, and enabled her to put her son in a better school, too.
Today, Pereira is a leader and influencer among drivers. One of those drivers is Clezio Rodrigues, 42, a single father who lives with his two children in the East Zone of São Paulo. Pereira first recommended Kovi to Rodrigues, who also works as driver for the ride-hailing app 99, after he lost his primary vehicle of income when his ex-wife kept their car following a divorce.
Rodrigues, a customer with Kovi for three years now, is currently utilizing the Kovi Proprio plan—a rent-to-own four-year plan with an option to buy the car or exchange it. The financing model was critical to help him continue his livelihood. He told the UNSGSA that he didn’t have a credit card and large deposit to access a car, so a smaller “safety deposit” and a weekly payment method offered by Kovi was more suitable.
This in turn bolstered his financial health. His earnings increased approximately 30% to 40%, and he has a better quality of life, Rodrigues told Queen Máxima. He added that because of the commitment every week with Kovi’s payment system, it makes him plan financially, thinking more about life and family. On top of that, he can live in a better place and the car is an asset for the family.
While access to cars can help drive income opportunities and better financial health for underserved groups in Brazil, Neto and Coutinho are also working to boost people’s livelihoods through a training school and employment as mechanics for Kovi.
Paloma Lopes, 25, was the first female student to graduate from the mechanical school and has been working at Kovi for over one year now. She explained to Queen Máxima that it was an incredible opportunity for her, saying, she studied automotive mechanics (prior to Kovi) and was worried about securing a job since it is a male-dominated profession. However, one month after she graduated, she received a message from Kovi about this opportunity—it was a door opening that she was not expecting, and today she has been promoted to the quality department.
Lucidalva Santos, a 46-year-old single mother who supports two children, told the Special Advocate that she always liked tools, so she was excited to learn about and participate in Kovi’s mechanical school as well. Today she is a body shop assistant with the company.
Santos explained to the UNSGSA that employment with Kovi has been a lifeline, after encountering financial difficulties during the pandemic, including having trouble paying for her son’s schooling. Because of her new job, she was able to meet those payments and is saving for other long-term goals and building financial resilience in case another pandemic or crisis comes along.