Vodacom provides short-term funding product for SMEs
SA’s leading mobile carrier Vodacom has intensified its desire to grow its financial services business, launching a financing product for small to medium enterprises (SMEs), called VodaLend Business Advance.
The telco says in the interest of stimulating economic growth, Vodacom hopes to provide such companies with quick and easy access to funding.
VodaLend Business Advance’s qualifying criteria requires SMEs to be registered and operational for at least 12 months, with annual revenue of over R500 000 and good credit standing.
The loan size of the advance varies from R10 000 to R1.5 million and is repayable over six to 12 months. The application process is fully digital and Vodacom says it could take a business owner less than 10 minutes to complete.
Vodacom has, in recent months, been aggressively pushing its financial services products, leveraging its massive customer base.
“Small and medium-sized businesses are the backbone of South Africa’s economy and contribute significantly to employment in the country as well as the gross domestic product, which is why ensuring their growth and success is vitally important,” says Vodacom financial services chief officer Mariam Cassim.
“Providing access to SME funding not only benefits the business owner by allowing them to grow their business but also creates job opportunities and positively impacts the economy as a whole.”
Vodacom says over and above the short-term finance, qualifying SMEs will also receive Business Legal Assist, at no further cost, which will support the companies in their day-to-day business legal questions for the duration of the advance term.
Vodacom wants to grow its financial services business in SA to R2 billion in the next 12 months.
In a recent interview with ITWeb, group CEO Shameel Joosub said the telco has turned around its previously loss-making financial services unit into a vital business cog.
The Vodacom boss believes SA is one of the fastest-growing places when it comes to fintech. This as new research by Rand Merchant Bank shows SA has a flourishing fintech sector.
Fintech has disrupted the financial sector across the world, bringing much-needed innovation and change, and Vodacom wants to be part of these changes, as evidenced by the success of M-Pesa.
In the past six months, Vodacom’s financial services grew by 37.1% to R972 million. During the same period, the operator advanced R4.9 billion in airtime via its Airtime Advance platform to 9.9 million customers.
Vodacom’s insurance revenue increased by 21.8%, driven by the launch of products such as VodaPay, which enables direct airtime purchases and bill payment for electricity and other payments.
Cassim says: “Vodacom Financial Services intends to go beyond just providing funding and is looking to be a partner in growth for SMEs. With the trust we have built as a leading telco, we want to ensure financial inclusion for all within the financial services space and will continue to deliver best-in-class services and products.”