Standard Bank’s digital platform loans out R3bn to SMEs
This is according to a statement issued by the bank, saying between July 2019, when BizFlex was launched, and June 2022, the facility provided loans to approximately 10 000 SMME businesses across SA.
South Africa’s Standard Bank Group was the largest bank in Africa as of 2021, with total assets worth nearly $173 billion (R3 trillion), according to Statista.
The big-four bank describes BizFlex as a paperless loan application, disbursement and repayment system that businesses access through their online banking platform.
It explains that BizFlex was built using intelligence gathered from face-to-face client interviews, an extensive online banking survey and direct business banker feedback.
Standard Bank’s announcement comes as more South African firms are targeting SMME businesses with loan facilities.
Last week, JSE-listed telecommunications group Telkom Business launched its Telkom Lend product to enable small businesses to apply online for funding of up to R5 million and get an answer within 24 hours.
Earlier this month, digital bank TymeBank said it had reached an agreement with Retail Capital and its shareholders to acquire 100% of the fintech SME funder’s shares, subject to regulatory approval.
This acquisition will enable TymeBank to expand its offering to entrepreneurs to include working capital finance.
According to McKinsey, the lifeblood of South Africa’s economy is SMEs that make up over 98% of businesses across the country and contribute 39% of the country’s GDP.
“Gone are the days when crippling fixed monthly loan repayments were expected from us even when our income was inconsistent or unpredictable,” says Standard Bank.
“One of the scariest things about operating a business is taking on debt when one is uncertain about future earnings, especially in tough times. With rising interest rates, business loan repayments that were once affordable can quickly start threatening cashflow.”
More generally, “data shows the difficulties South African businesses experience when trying to access flexible credit quickly are impacting their ability to survive and grow,” says Darren Segal, head of Standard Bank’s Moonshots.
“This is especially true in tough times when it is crucial for businesses to have the capital to take advantage of opportunity.”
With this challenge in mind, Segal adds, “we set out to launch a digital, fixed-cost, pay-as-you-earn loan facility – an ambitious undertaking for a business loan”.
Although BizFlex is currently only available to qualifying Standard Bank business clients in South Africa, “we are considering rolling BizFlex out to other African markets,” says Segal.
Standard Bank is also looking at opportunities to partner with other non-competing financial services organisations globally to help them launch BizFlex to their clients.
Courtesy of IT Web – full article here