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Merger enables SMEs to access funding more speedily – Miguel da Silva

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Miguel da Silva, managing director of Retail Capital Group’s Funding division.

CAPE TOWN – Small to medium enterprises (SMEs) are critical to the growth of our country’s economy. It’s estimated that SMEs contribute over a third (34 percent) to the country’s gross domestic product (GDP) and make up roughly 90 percent of South African formal businesses. But considering it is growing at a mere 1 percent, there is a clear need for investment into this vital sector.

But for this to change, the way small businesses apply and access these funds needs to become more efficient.

Even though government committed R1.5 billion into a Small Business Fund last year, the reality is that this needs to be shared among more than 2 million SMEs. More is needed to make a real difference to the economy. As a corollary, the reliance on private lenders has increased significantly.

In a move designed to provide its small business customers with the means to access additional funding in a challenging economic climate, international cloud-based accounting platform Xero has partnered with  three of South Africa’s leading digital lenders – Bridgement, Retail Capital and LulaLend.

Access to funding, especially when it comes to supporting increased stock levels, new locations and new channels to customers, is a business imperative for SMEs. The agreement between Xero and the three digital lenders aims to address this.

The agreement allows customers to contact these lenders from within its platform. In turn, the lenders will be able to access financials from applicants immediately, speeding up the approval process and removing the need for cumbersome paperwork.

“We want to help South Africa’s small businesses thrive by removing the friction involved in accessing funds,” says Colin Timmis, General Country Manager, Xero SA. “A lack of capital is one of the biggest challenges impeding small business growth in this country so by integrating the latest business finance apps with Xero, SMEs will have better accounting data, which can help them access capital.”

Launched in September 2016, Bridgement identified a gap in the local market to provide short-term financing solutions for SMEs. The company empowers these small businesses to expand operations by taking on bigger projects by bridging gaps in cash flow through an invoice and finance creditor facility of up to R1 million.

“We reached a personal record when our quickest time to funding for a customer was 2.5 hours from application to receipt of funds,” says Daniel Goldberg, founder of Bridgement. “To put this into context, the average time among major banks in the country is approximately five weeks.”

From a partnership perspective, Bridgement is excited about the potential to make funding accessible to a broader base of SMEs.

“Many SMEs do not apply for funding because they either do not understand the process or are disheartened by getting turned down numerous times,” says Goldberg. “This partnership sees us delivering improved innovation to make things simpler in small business finance.”

Since 2011, Retail Capital, has advanced almost R2 billion to SMEs and has helped over 6 000 SME businesses in the last year with funding for expansion. This in turn leads to business growth and more employment.

“Banks have made gaining access to funding a very tedious process where we offer SMEs with speedy, convenient access to funding,” says Miguel Da Silva, MD of Retail Capital Group’s Funding division. “We estimate that the additional funding provided by us over the past eight years has resulted in more than 12 500 jobs being created.”

According to Da Silva, the Xero partnership is designed to offer a faster funding solution.

“Already, access to the Xero API has enabled Retail Capital to view customer information easily, resulting in real-time decision-making on the approval process. It alleviates much of the time pressure when it comes to determining the eligibility of a small business for funding.”

The third partner, Lulalend, was launched in 2013 to help grow small business in the country. Like Retail Capital and Bridgement, Lulalend is a digital business working with access to customer data instead of meeting them face-to-face.

“SMEs are significantly underfunded and banks are not proactive in helping them grow,” says Trevor Gosling, founder of Lulalend. “We wanted to launch a technology company that could provide SMEs with assistance at scale.”

It provides lending to a variety of clients ranging from those with R100 million turnover to sole traders.

Integrating with Xero enables Lulalend to gain immediate access to company records, resulting in a more efficient credit risk assessment. This greatly improves the speed of funding decisions, providing small businesses with the capital they need to grow.

BUSINESS REPORT ONLINE

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Sahara Group Canvasses More Investment In Africa’s E&P Business

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Paris France: June 25, 2019 – Oil and Gas businesses in Africa need to intensify exploration efforts to guarantee reserve replacement and enhanced capacity to meet growing demand and global competition, Olajumoke Ajayi, Managing Director, Asharami Energy (A Sahara Group Upstream Company), has told participants at the Oil and Gas Council’s Africa Assembly in Paris.

Ajayi noted that Africa’s large volumes of undiscovered oil and gas makes the continent a veritable frontier for investment, adding that operators need to adopt new technology, explore alternative cost saving measures, ensure sustainable community relations, and build diverse multidisciplinary teams to ensure successful exploration projects.

In her presentation, “Renewing Players Commitment to Exploration and the Importance of Community Engagement in Capital Intensive Projects”, Ajayi cited the downturn in global oil prices and the corresponding negative effect on investor funds and returns as factors that have made a good number of Exploration and Production (E&P) companies in Africa cut down on investments, delay Final Investment Decision (FID) or totally stop embarking on new capital projects.

“Consequently, producing companies continue to pump oil from operated mature fields thereby depleting existing reserves with non-corresponding efforts for reserve replacement via new exploration discoveries. The big question remains whether or not E&P players should commit to exploration and how players can justify this commitment in the face of lower oil prices,” she stated.

According to Ajayi, the compelling case for the relevance of hydrocarbons in the future, in addition to huge investments on new technology, responsible and intentional community engagement will play a significant role in creating a stable and conducive environment for exploration and production. “Sahara Group’s exploration success story is being driven by a combination of technology, innovation and community management expertise. At Sahara, we are intentionally committed to creating a sustainable balance between our projects and host communities to ensure the creation of shared value for all stakeholders.”

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Going by the PwC Oil and Gas Review 2018, proven oil reserves in Africa have stayed at the same level of 7.5% of global reserves. The report also notes that exploration activity continued to decline in 2017. “The consequences of modest recovery in exploration spending and a continued decline in new discoveries are unavoidable and imminent. The International Energy Agency and various players in the oil industry have warned of demand exceeding supply as oil demand continues to grow and investment in projects is deferred,” the report stated. The report adds that Africa’s oil and gas consumption is predicted to increase by 45%, increasing its global share 5.1% by 2050.

Ajayi said strategic community engagements eliminate community interference in operations of capital projects that may lead to significant downtime; ensure that the host community understands its role as a project stakeholder and treats projects as commonwealth source for the people; reduce security breach as community representatives serves as infrastructure surveillance outfit; and promoting easy negotiations for Freedom To Operate (FTO) and Global Memorandum of Understanding (GMOU).

– Sahara Group

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Moustafa Madbouli witnesses signing of agreement with Mercedes-Benz on car assembly

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Mercedes-Benz A-class cars are displayed in a dealership of German car manufacturer Daimler in Paris, July 30, 2013. REUTERS/Christian Hartmann

STUTTGART, Germany – 24 June 2019: Prime Minister Moustafa Madbouli on Monday witnessed the signing of a cooperation agreement between the Egyptian government and German automaker Mercedes-Benz to boost bilateral cooperation in auto industry.

The deal is meant to establish an engineering hub for Mercedes-Benz in the Suez Canal area for assembling and manufacturing of automobiles, the premier said.

This comes as part of the state’s strategy to support the intelligent transportation system and electricity-powered means of public transport, the premier added.

He noted that the agreement represents a quantum leap in Egypt’s auto industry, asserting that Mercedes-Benz hub will not just serve Egypt, bu also the whole region.

Madbouli is currently on a visit to Germany to take part in the 22nd session of the Arab-German economic forum. He is accompanied by a high-level delegation grouping the ministers of international cooperation, electricity, petroleum, communications, trade and industry in addition to a number of businessmen.

– Egypt Today

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Taxify, now Bolt, launches Bolt for Business in SA

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Bolt Image: Techcentral

DURBAN –  Bolt has launched Bolt for Business, allowing companies of all sizes to manage and pay for corporate trips via a single, easy-to-use portal.

This addition to the Bolt range of services broadens the positive impact of on-demand transport for businesses, as companies can now democratise access to jobs by removing the ‘own transport required’ condition for employment, and have access to a simple service offering for employees and clients alike.

They can do this by allocating a monthly budget through the Bolt platform to individual employees, ensuring that all employees who travel for business enjoy the benefits of affordable and reliable personal transport without the often prohibitive costs associated with vehicle ownership.

“We have launched Bolt for Business after noticing that a growing number of Bolt trips are taken for business purposes during working hours, whether it’s commuting to work, rushing to client meetings or getting to the airport,” said Gareth Taylor, country manager for Bolt South Africa.

He added, “In a country with unreliable public transport and high costs of car ownership, Bolt for Business offers a convenient and cost-efficient solution to business travel. It also provides an alternative transport option for the many young people entering the workplace who cannot yet afford their own vehicle, or who actively choose to not buy a car”.

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In addition, Bolt for Business is the perfect solution for entrepreneurs and SMEs, where time is money and hours spent in traffic can be put to better use if someone else – like a driver on the Bolt platform – is driving.

Bolt for Business gives companies the ability to offer employee groups, clients and recruits the option to utilise the Bolt service at the company’s expense, and gives account managers the ability to set and customise spending allowances and the number of trips employees can take.

The digitised travel management solution, available on desktop and mobile, saves businesses time and money by storing all the information about their employees’ corporate Bolt trips on a single dashboard. Paying for trips is quick and easy: instead of reimbursing each individual employee, companies can pay Bolt once a month via a bank transfer.

“Bolt for Business is so much more than an efficient expenses management tool – it removes workplace discrimination based on access to vehicle ownership and offers a strategic use of time spent on the road, demonstrating again the positive impact that on-demand transportation  services can have on the South African economy,” added Taylor.

Additional functionalities such as adding restrictions to specific times and locations for taking trips, as well as a prepaid payment method, will be added to Bolt for Business later this year.

Bolt for Business is available in more than 30 markets across Europe and Africa.

BUSINESS REPORT ONLINE

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