New capital loan fund launches for SA SMEs

Local SMEs can apply for a loan with the launch of a new capital loan fund. 

Founded by Yellow Pages which is owned by Telkom Business in partnership with fintech  Fundrr, the new capital loan fund aims to offer businesses who have been negatively impacted by the pandemic a lifeline in much-needed funding. 

The new capital loan will allow businesses to grow their online presence and overall business model

The impacts of Covid-19 have been far-reaching, resulting in thousands of South Africans losing their jobs and main source of income. This new capital loan funding will allow small and medium enterprises the opportunity to revive their businesses. 

The dynamic partnership to create this new capital fund is the result of a duo that both independently support the growth and development of South African SME’s. The necessary funding could allow SME’s to buy stock, open new stores, purchase equipment, undertake renovations, or expand the business.

Yellow Pages, a division within Telkom Businesses aims to provide support packages to small businesses. These support packages are aimed at utilising technology to increase business visibility and increase sales while branching into new markets. 

Lunga Siyo, CEO of Telkom Business, Yep, and Yellow Pages explains that the partnership with Fundrr now allows for an all-round package to be offered to SMEs.

“Online presence is more important than ever, especially during Covid-19. We offer all small businesses access to an online footprint which will enable growth and increased awareness within their sector. One of the biggest challenges for small businesses is access to funding, so we have teamed up with an alternative fintech lender for SMEs, Fundrr, to round off our offering by providing a holistic support package.”

Fundrr provides business loans and claims to provide one of the quickest turnarounds loan applications with an overall response provided to applicants within 24 hours. Applicants to Fundrr must be a South African business with an operational track record of at least 12 months within a minimum of R1-million turnover or asset value. 

The partnership between Yellow Pages and Fundrr will not only offer capital loan funding but also provide SME’s with an online presence to excel in their business model and product offering. 

How to apply 

There are a few requirements to qualify to apply for the new capital loan fund: 

• If applicants are existing Telkom Business and/or Yellow Pages clients and qualify for a loan, Fundrr will provide you with funding for your business faster.
• Applicants must not have had any judgment, default, or debt reviews in the past. 

 Potential applicants visit the website to apply .

It is not all doom and gloom if an applicant is not a Telkom Business or Yellow Pages client. If an applicant wishes to become a client and successfully applies for the funding available, Fundrr will pay for the first six-months of a Yellow Mystart subscription. 

The subscription will provide assistance in helping the applicant’s businesses to gain online traffic, increase its overall turnover through various revenue streams, improve SEO, and increase the SMEs overall social media presence. With many businesses shifting towards utilising online as a sales mechanism, this subscription can revive a business. 

Fundrr has developed an automated credit model that analyses nearly 100 data points of businesses including social media, online marketing presence, and a list of other criteria that provide an overall bigger picture of the SMEs growth potential. This data reading provides a ”Funder score” which allows Fundrr to provide loans ranging from R20 000 to R500 000 to small businesses. 

 Idan Jaan, Fundrr CEO, comments on the creation of the new automated credit model and need the for loan funding for SMEs in South Africa.

 “We realised that new and innovative ways to evaluate small businesses for credit are needed. So few SMEs qualify for funding and there’s a desperate demand for financial assistance, particularly during this pandemic. There’s insufficient government support available and banks lack the appetite and understanding how to underwrite small businesses. The copious amount of paperwork and long turnaround times preclude small businesses accessing the working capital they require.

Repayment of loans 

Fundrr creates tailored loan repayment systems for applicants based on an analysis of the cash flow patterns and one that is most suitable to the client’s income. The repayment system can range from daily, weekly, bi-monthly, monthly, or over a 3 – 12 month period. Rates of interest vary depending on the strength of the business. Lower risk businesses can expect to pay lower rates.

Fundrr offers an early repayment incentive and specifies the amount of the loan, the duration and the total amount to be repaid upfront with no hidden fees.

Read more: SA’s best Small Business Funder announced
Read more: Township tech startups accelerator launches
Featured image: CEO of Fundrr, Idan Jaan and CFO of Fundrr, Jarred Noche (Supplied)