Credit management specialist Real People has today announced funding of US$20 million from Canadian fund manager Cordiant - via Real People stakeholder Netherlands Development Finance Company FMO - for the growth of its unsecured credit book in both South Africa and African outlets.
The loan is in the form of a Cordiant and FMO funded risk participation agreement.
Real People say this backing is highly significant for the group. The funding is Real People's first direct access to capital from North America - and a meaningful vote of international confidence in the group's credit model, particularly given prevailing sentiments in the credit climate worldwide.
Real People deputy managing director Neil Grobbelaar comments: "Ongoing access to funding is critical to our growth, and we're pleased to have excellent funding partnerships in place at home, in Europe and now in North America as well. With the general instability in credit markets in North America, this deal illustrates the attractiveness of the Real People business model, which focuses on the acquisition and management of personal credit risk in Sub-Saharan Africa.
"With new funding facilities of approximately R1 billion secured since April 2007, this bodes well for our group's ability to maintain our growth path, without compromise to prudent solvency margins."
"Moreover, we also see the facility from Cordiant, a pre-eminent fund manager in emerging markets, as endorsement of our regional strategic focus. Our solid and ongoing relationship with FMO, who are also stakeholders in our group, is an alliance we value highly, as FMO, like Real People, is committed to facilitating the delivery of financial services to previously neglected markets in Africa by supporting entrepreneurial businesses such as ourselves," says Grobbelaar.
Real People unsecured personal loans in South Africa and in Sub-Saharan African countries enables clients to fund education, home improvements and other household needs.
Arthur Arnold, FMO's CEO, said: "FMO always strives for additionality and seeks to facilitate its partners to attract other financing by attaching its name as a reliable and stable partner with an AAA rating. We strongly believe that our longstanding cooperation can pave the way to an even more successful future for Real People."
David Creighton, Cordiant's President and CEO, said: "Cordiant is pleased to support Real People as it fosters the entrepreneurial spirit that encourages and facilitates the growth and sustainability that is so crucial to Africa's continued development. We have long believed in the countless opportunities the continent presents and our history of successful African investments over the last several years is a testament to our commitment to the region and our understanding of what it has to offer."
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