The "Handset Rent-to-Own" solution is aimed at getting millions of South Africans, many of whom still rely on outdated feature phones, to get connected with modern technology.
The phones will be made available for "as little as R10/day" with no credit checks or paperwork required, MTN said in a statement.
The move comes just two months after MTN South Africa announced plans to sell subsidised 4G smartphones costing as little R99 each.
"Powered by MTN's trusted fintech platform in partnership with Airvantage, the service uses advanced AI-driven affordability assessments - with no payslip and no credit check history required. The process is smart, secure and tailored to the realities of South Africa's informal and underbanked economy," MTN said in Thursday's statement.
"Once approved, customers choose a flexible payment plan - either three, six, nine or 12 months - and once payments are complete, the device is theirs to own, forever."