4 FinTechs helping SMEs bridge the financial gap in Africa

By Gloria Methri

Small and Medium-sized Enterprises or SMEs play a vital role in the economic growth and development of Africa. According to McKinsey, SMEs make up about 98.5% of all businesses in South Africa. 

However, many of these businesses face numerous challenges, including limited access to financing. Fortunately, FinTech companies are stepping up to provide solutions that help SMEs thrive in the continent, marred by the COVID-19 pandemic.

Here are four FinTech companies helping to bridge the financing gap that hindered the growth of SMEs in Africa.

• Zanifu

Kenyan FinTech Zanifu provides short-term stock financing of up to $2,000 to MSMEs in Kenya. To date, it has extended 85,000 working capital loans worth over $13 million to 7,000 businesses in Kenya. Moreover, Zanifu has created platforms for manufacturers, distributors, and retailers that ensure seamless ordering, payment, tracking and fulfillment.

• Wasoko

Wasoko, formerly Sokowatch, provides a mobile-based platform for SMEs to order and receive supplies, as well as access credit facilities. Thousands of retailers across Kenya, Tanzania, and Rwanda use Wasoko’s mobile ordering and delivery service to receive goods quickly and affordably while also accessing growth financing for the first time.

• Lidya

Nigerian FinTech Lidya provides a flexible credit infrastructure so lenders can acquire customers, originate loans, and collect repayments with confidence. The company is said to have digitized and analyzed over $50 billion worth of credit application data from one lakh customers, issued 32,500 loans, and powered close to $150 million in loan disbursements.

• Branch

This Kenyan-based mobile lending platform provides loans to SMEs without collateral, enabling them to access funds to grow their businesses. Branch has raised more than $667 million from investors such as NEA, Founders Fund, and Playground Ventures and is headquartered in Palo Alto, CA, and with offices around the globe.