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Retail Capital Easy Funding Solution for South African SMEs

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Retail Capital a division of TymeBank is a one stop, one click funding solution for SMEs who need an instant cash injection. The platform has cut out all the complicated administration that often accompanies procuring funding and simplified the process – making it easier for businesses to get the financing they need within 24 hours. Before, and during Covid the company was also monumental in ensuring business continuity for businesses across the country.

In an in-person interview with Luca Merlo, Retail Capital’s Product Manager delves deeper into how the lending service differs from banking services, and how the company has leveraged technology to simplify the money lending process making it easier for businesses to access the funding they need.


How has retail capital contributed towards the growth of South African Startups?

The one thing I think we’ve done successfully is we’ve partnered with bigger corporates like the likes of Payfast that have interacted a lot with SMEs. How we’ve assisted them is, we’ve provided them a platform that they can apply to funding with the use of Amazon one-click button that allows SME’s easily to apply for funding and use that funding to broaden their business horizons.

SMEs struggle with cashflow, so our clients have benefitted from it in that aspect where they need extra cashflow, they apply with us, get that cashflow and it allows their business to continue to trade. Alternatively, what we’ve seen is where SMEs need funding to expand and grow, but they don’t have the cashflow coming in from revenue, they apply through us, they use the capital to increase their business turnover and grow their business that way. The success of it is quite relevant because 70% of our customers return.

Example of a South African SME that you successfully assisted with funding?

Just before Covid, we assisted one of Payfast’s customers – Cape Massai Leather procure funding. This particular business was struggling with cashflow. They had a decision to make either they lay off staff or they apply for the funding. He decided he could not lay off his 5 staff members and he applied for the funding and that’s how he secured the continuity of his business.

You mentioned that Retail Capital as an ‘easy’ retail solution, how easy is it actually?

Even for the non-techy individual, if you look at where our customer base comes from – they range from really small SMEs with a turnover of about R50,000 a month to really large SMEs. I don’t want to classify but the the smaller SMEs are not always the most tech savvy – even they can easily run through the process.

They literally only have to go through three screens. One screen requires confirmation with drag and drop scrollers where you can confirm how much you want to take and how long you want to take it for, the second screen is confirming your personal information like your ID number, proof of residence and banking details then the last step is where you apply and once you apply the contract gets sent through to the applicant and it can then be signed digitally. The funds are then dispersed within 24 hours.

How is Retail Capital staying up-to-date with emerging tech trends?

We are on the forefront of cutting-edge technology. We’ve recently launched our BETA called ChatSME. We’ve taught it how interact with all of our learnings from an SME perspective anyone can go onto ChatSME and start interacting with that platform and ask the questions that you would want to ask a human being how to start up a business or what are my funding options.

It really is a two-way conversation and it really is a two-way conversation and it really feels like you’re speaking to a human on the other side. From a customer design perspective we always try to enhance and improve our platform to make the process easier, customers don’t want hurdles to jump over to access your product at the end of the day.

Is there a limit to the funding that an SME can access and what determines the limit?

There isn’t really a limit. If you need access to more funding than that we’ve initially offered you have to go down a different path to access more funding.

What we would need is proof of financial statements in order to do the due diligence in going  through the underwriting process comprehensively to determine weather the customer would be able to repay us – this would then determine the amount that the customer would be able to access. Generally our limit is R30 million.

What key advise can you provide a startup SME that wants to grow but does not yet have enough capital to request funding?

From a retail capital perspective, keep on doing what you’re doing until you have evidence of 4 moths worth of turnover. Keep staying the course and then you can approach a lending platform like Retail capital. Generally, we are one of the very few that allows for a minimum of 6 months turnover – the others a year or two years.

In conclusion, keep doing what you are doing – you are contributing towards the South African economy at the end of the day. I don’t think enough light shone on SMEs especially tech SMEs and the impact they have in the economy. Staying the course will make the difference.

What differentiates you from a bank lending service and why should an SME choose your service over the bank?

The benefit of using our service as opposed to banks is we are a less rigid. We don’t worry about how the funding is used for whereas banks need to know exactly what the money is being used for. We are also a lot more adaptable and amenable when it comes to payment return terms.

For example, how Retail Capital works is we are not to concerned about taking a reduced payment amount and prolonging the repayment term to suit the customers need while banks want repayment amounts at a set rate within a specific period of time.

We also have a different way of collecting repayment – we collect on a more regular basis – which makes the repayment amount smaller for the merchant and it doesn’t effect the cashflow as drastically as a bank repayment does.

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