The South African SME lending market is currently a vast and under-served market…
The South African SME lending market is currently a vast and under-served market, largely ignored by traditional providers of credit such as banks. As such, the sector provides an attractive, largely untapped market opportunity for fintech funders that can develop new technology-driven lending products and risk assessment tools to assess credit risk innovatively.
Fortunately, several alternative SME lending institutions in South Africa are already using technology to provide efficient and effective lending services to underserved SMEs, with Retail Capital being one such company. It has partnered with more than 38,000 SMEs in providing funding of more than R4 billion to date.According to Retail Capital’s Founder and CEO, Karl Westvig, “Business is the lifeblood of the economy, and small and medium businesses are the growth engine for the future, employing the most people and growing faster than large businesses. They must have the resources and the skills to grow. At Retail Capital, we partner to provide funding and support services to benefit South Africa.”
The Tamela Mezzanine Fund I (the “Fund”) has provided capital to Retail Capital to enable it to provide more funding to SMEs. The Fund currently has assets under management of circa R1 billion, providing mezzanine and “quasi” equity investments for the financing of BEE transactions, infrastructure, leveraged and management buyouts, and expansion/growth capital.
The Fund will provide funding of between R50 million and R200 million to companies in South Africa, Namibia, Botswana, and Lesotho seeking capital for growth and expansion.
For more information, contact Moeketsi Mokuoane (moeketsi@tamela.co.za) or Vusi Mahlangu (vusi@tamela.co.za)
www.tamela.co.za