Following a prior investment in 2019, Finch Technologies, a Cape Town-based fintech, has made a large further investment to become the majority stakeholder in South Africa’s premier business financing marketplace, FundingHub.
“We made a second investment into FundingHub, due to its dramatic growth over the past 18 months. We are confident about the ongoing expansion of this business. We are particularly interested in investing in technology-driven businesses that help financial service providers originate sales, onboard new clients in a seamless manner and enrich their own database. It is through the seamless origination and onboarding that real value is offered to businesses and consumers,” said Michael Bowren, Finch Technologies CEO.
Here Is What You Need To Know
- FundingHub connects South African SMEs with 33 banks and other lenders that can help them expand their company. SMS may evaluate finance alternatives for free, ranging from R10,000 to R100 million, thanks to the company’s four-year-old business. SMEs who apply for finance on FundingHub have been in operation for at least six months and generate a minimum of R350,000 in yearly revenue. They’re matched with the most suitable lender.
- Finch Technologies controls 100% of Fincheck, South Africa’s leading financial comparison marketplace, which assists consumers and companies in finding the best financial solutions for their requirements.
- Finch Technologies presently has three technology-enabled products: two marketplaces (Fincheck and FundingHub), a document collecting and verification system (Gathr), and a credit rehabilitation technology that shows an individual’s credit report in a simple and free manner (BetterScore).
Says Bowren: “Finch Technologies is rapidly evolving both our marketplaces, Fincheck and FundingHub to provide an end-to-end solution. This means that both platforms will allow South Africans to apply for financial and insurance products, upload the relevant documents and compare, in real time, the offers that banks, lenders and insurers have available. This is a significant advance in the South African market and a necessary move towards an open financial ecosystem.
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“Since the start of Covid-19, FundingHub has seen a dramatic increase in requests for financing from SMEs,” he adds. “This is for two main reasons. The first is SME distress and their struggles to manage cash flow. The second has been the inability or reluctance to visit a physical bank branch. SME owners are therefore searching and comparing options online.
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“Businesses and lenders have therefore been driven to accept a full digital solution which encompasses the vision of Finch Technologies which is moving toward a full end-to-end marketplace, offering everything short of disbursing the final product.”
Charles Rapulu Udoh
Charles Rapulu Udoh is a Lagos-based lawyer who has advised startups across Africa on issues such as startup funding (Venture Capital, Debt financing, private equity, angel investing etc), taxation, strategies, etc. He also has special focus on the protection of business or brands’ intellectual property rights ( such as trademark, patent or design) across Africa and other foreign jurisdictions.
He is well versed on issues of ESG (sustainability), media and entertainment law, corporate finance and governance.
He is also an award-winning write