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Sasfin buys into fintech lender Payabill

Staff Writer
By Staff Writer, ITWeb
Johannesburg, 22 Feb 2019
Sasfin CEO Michael Sassoon.
Sasfin CEO Michael Sassoon.

JSE-listed financial services provider Sasfin has bought a stake in fintech lender Payabill for an undisclosed amount.

Although Sasfin would not disclose how much it invested in the stake, it describes it as a "significant minority stake".

Payabill is a 100% digital lending business that provides working capital and trade finance to small businesses.

The collaboration between Sasfin and Payabill accelerates financing opportunities for customers, the companies say in a statement.

The deal comes after Sasfin last year launched its digital platform, B\\YOND, for SMEs.

"Sasfin has been investing in fintechs, building digital capabilities, such as B\\YOND, and working with third-parties such as XERO Accounting for a number of years, with the aim of adding value to our business and wealth clients," says Sasfin CEO Michael Sassoon.

"Payabill has made huge strides in giving businesses access to digital finance and we are thrilled to announce this investment."

Payabill CEO Eli Michal launched the fintech start-up in SA in 2017. Payabill settles suppliers directly for its clients and allows clients to select their own extended payment terms.

"We are incredibly excited by the opportunity afforded to Payabill by having Sasfin as an equity and debt partner. Sasfin will provide access to new channels and much-needed funding that enables us to support the growth of small business finance in South Africa," says Michal.

Michal says he started the fintech as he wanted to enhance access to finance for small businesses in SA.

"We all know that boosting small business creates jobs and enables growth. Traditional lenders have neglected this segment of the market due to the high costs associated with on-boarding and assessing these customers, as well as managing their credit risk," he says.

"It made no sense to us that a retail consumer could get multiple forms of credit, almost instantly via electronic channels, but small businesses could not. They were being neglected. With this in mind, we set out to build a completely paperless, digital solution to address this market's unique requirements."

Currently, Payabill offers loans of up to R150 000 to businesses. The intention is that with the investment made by Sasfin, Payabill will be able to offer larger loans to SMEs in the near future.

The companies say the alignment of Payabill's aims and Sasfin's long-term focus on small business in SA made for an ideal partnership.

"SMEs can now borrow digitally, via Payabill, and bank via B\\YOND from Sasfin - reducing admin and costs which often stifle small business growth. Both B\\YOND and Payabill are gaining meaningful traction in the SME market and there are a host of additional digital initiatives that we are working on to further help small businesses thrive," says Sassoon.

"While Sasfin has always offered a trade and debtor finance solution, this was largely for more established businesses. The new offering speaks to smaller businesses that are passionate about growth, and our larger trade and debtor finance offering will be there to support businesses that reach the next phase in their development," he concludes.

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