EDITOR'S NOTE: This article is a part of our Money254 Partner series and is produced in partnership with Absa Bank Kenya . For more on Money254’s editorial policy, read here.

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In August last year, my office deskmate and I swore to never suffer much longer with the inconvenience of public transport. 

It had been weeks of terrible weather in Nairobi and we had just had it. We would always get to work late and our umbrellas would be parked on the office front door which was christened the Footsubishi parking lot. 

On top of it, we would always be the first ones to hit the road in the evening, afraid that the sky would fall on us before we got home. 

Once in a while, we would have the (dis)pleasure of being the ones to switch the office lights late at night. This is because if the rains fell before we left the office, we had to wait until late night when the Uber fares would resume normalcy. This typically happened after about two hours of crazy prices caused by Nairobi rain traffic. 

Reminds me, I have always wondered about the connection between the rains and Nairobi traffic, I wonder whether our drivers don't see when it rains - but I digress, back to me and Anne - my deskmate. 

As the warm weather resumed, I nearly forgot about our goal of each buying a personal car by January this year. The routine reminder would have been my annual Christmas travel to the village. 

Over the years, this sojourn has always inspired my dream of having my car. I mean, there is a lot to think about your future when you spend a 10-hour journey sandwiched between all manner of luggage that includes a live chicken and a smelly goat. 

However, in December of 2022, I missed this unpleasant experience courtesy of my elder cousin who had recently bought a 1996 Suzuki Vitara after landing a huge commission at work. It was not the most comfortable car but given what I was accustomed to, we were cruising nicely. 

A few weeks after our returning to Nairobi in January, I was surprised to overhear my deskmate Anne ask the HR manager about arrangements for a parking slot. 

“Anne, whose car are you borrowing and why haven’t you told me about it.” I asked my friend. 

“I think I might be in luck, after months of saving, I was going to reach my target at the end of February, but I just got a windfall after a client paid a huge spare parts order.”

By the last week of January, Anne was driving to work in her brand new wine-red 2015 Mazda Demio.

The development was another reminder to check my progress on the savings I had made towards buying a car. It was not looking good. 

The March rains were fast approaching and the country was already decrying the delay in the rains. I needed to act fast before I was all alone in the Footsubishi parking lot. 

Anne and I are in the same income bracket, so I felt some positive challenge that she was able to get to her goal. 

Like myself, Anne has a side hustle, she has a motorcycle spare parts distribution business which she co-owns with her brother. My side hustle is in the supply of mobile phone accessories and was doing just fine at the time. 

I asked Anne how she was able to save the money she needed to buy a car so fast, given my assumption that our incomes were almost similar. 

Over a cup of coffee, she explained to me some of her financial planning strategies that also revealed to me a number of missteps in my financial planning. 

Here are a few of the things I realised about Anne’s finances:

1. She had access to Ksh100,000 of interest-free money from her Absa Gold Credit Card which she borrowed whenever her business needed a boost. For example, to fund a time-sensitive order to an institutional client of her motorcycle spare parts side business. She makes her orders online so she can use her credit card whenever she needs to. 
2. On my part, I was regularly losing huge orders since I could not access the funds needed to actualise and even when I could access some funds, it was through digital and mobile loans where I paid a relatively high interest rate. 
3. When she needs to borrow for slightly longer periods (for more than 50 days), she pays a a monthly interest on her credit card debt, much lower than I was paying on my digital loans. 
4. She had more income from her side hustle and had better savings than myself courtesy, in part, of all this 50 days interest-free cash injection she was getting from the Absa Gold Credit Card.
5. She was almost always paying back her credit card balance before the end of the interest-free period. Meaning she was essentially getting “free working capital” via her credit card. 

Knowledge is Power

My immediate plan after the conversation with Anne was to organise my finances. I immediately opened an account with Absa which processed my salary and I closed down all my dormant accounts. 

Note that one is not required to open an Absa bank account to qualify for a credit card. However, I personally chose to open an account to ease accountability on my transactions and facilitate instant repayments for my Absa Classic Credit Card. 

After setting up my Absa One account, I knew I needed to apply for a credit card. I had never understood why Anne often used a credit card as opposed to the regular debit card which I was more comfortable with. 

See, I did not know the difference between them. My understanding was that the credit card was just more expensive because I had always seen its use in American movies. 

Here is what I did not know;

A credit card is a form of credit that allows you to borrow money from a financial institution to make purchases or pay bills.

• All Absa credit cards, including the one that Anne was using have a 50-day interest free window
• Whenever I needed emergency funds for my businesses, I would take short term loans online, while Anne would use the credit card limit and repay within the interest-free window saving significantly on costs. 
• The Absa Gold Credit Card allowed Anne to extend her professional networks through the Absa exclusive events, some of which I had to spend money to attend
• Anne’s Absa Gold Credit Card also came with great discounts from local merchants.  Anne would spend significantly less than I did while shopping for households, electronics, and groceries because of these discounts.

Applying and Receiving My Card

A few weeks after I opened a current account with Absa, I asked my employer to change my salary account, and further asked my clients to start making payments from this account. 

I returned a few days later to apply for my credit card. I was actually stunned to learn of the 5 credit card types that Absa offers its customers - each tailored to a specific use case. 

Read Also: Absa's Credit Card Reviews: What Is the Best Option for Me? 

I opted for the Absa Classic Card because I found it convenient for my needs given that: 

• One, the card has a limit of Ksh100,000 - or the equivalent of 1x my net monthly salary. This refers to the maximum amount you can borrow. Notably, I do not have to make any secondary application to borrow. Once my card is approved - I have the Ksh100,000 accessible to spend at my discretion. 
• I had the freedom to use the Ksh100,000 as I deemed fit, I could pay and even withdraw the limit from the ATM (at a fee, though) or transfer through mobile money
• It does not have any annual or registration fees. The Absa Classic Credit Card has zero annual fees for life!
• It has a 50-day interest window which allows me to increase my side-hustle working capital as the business demands and as long as I pay within the 50 days, it doesn't cost me any interest. 
• In case my side hustle clients delay in paying me and I have to stay longer than 50 days before repaying, the interest is 3.9% per month, much cheaper than the short term digital loans where I was paying as high as 12% per month - others that charge daily interest can be as high as 60% per month if the daily fee is 2%. 
• And I was earning more than Ksh20,000, which is the minimum net salary an existing Absa customer needs to be earning to qualify for this card. Note that for non-Absa customers the minimum net income requirement is Ksh40,000

The registration process was seamless, I was asked for a copy of my ID and two of my latest payslips. 

For non-Absa customers, the required documents are:

• Copy of national ID or passport
• Latest 2 months’ pay slip
• Bank statements - latest 3 months
• 1 passport photo

How the Absa Credit Card Has Changed My Life

It is now my third month since I received the Absa Classic Card and the only regret I have is that I didn't start earlier. 

The greatest benefit for me has been the access to what I consider “free money”. I can borrow up to Ksh100,000 when I need to support my side hustle with large orders. This has seen my business grow as I am able to support large orders without taking expensive loans. 

My regular shopping needs have also transformed. Before the card, I would always feel remorseful when I saw a great sale for something I needed, say a TV I had been saving for. Unfortunately, the discounted option always appeared when I was running low on money. 

In February, I bumped into a Valentine’s Day deal and although I did not have all the cash in my current account, I used my Absa Classic Credit Card limit to buy the TV at an incredible Ksh18,000 discount. 

My shopping experience has been enhanced greatly as I now enjoy discounts with merchants who have discount agreements with Absa. I am no longer envious of Anne’s significantly lower shopping costs because I equally qualify. 

My business networks have also greatly improved as I regularly tag along to Absa exclusive events, courtesy of my card. 

I have also been able to regulate my spending by ensuring that I only take the credit limit when I need to - and I make sure to pay my bill before the due date. 

Paying before the due date ensures that I do not pay any interest, which is why I consider this card a ticket to “free money”. 

Wrapping Up

As I look back on the past three months, I am hopeful that it won't be long before I save enough to buy my car. 

I know buying a car purely for going to work may not sound like the best financial decision, but I know it will also aid my movement and make it easier for me to expand my business. And personally, I find this a vanity I can live for, even though I do not recommend it for other people - unless you are, you know, me. 

I enjoy greater peace of mind knowing that my bank reciprocates the trust I have given them by entrusting it with my money - they equally trust me with their money. I have used the card to build a positive credit history and down the road, I know better things await me.