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Kenyan fintech company IMFact, which provides working capital to micro and small and medium-sized enterprises (SMBs) with supply chain finance, has received an investment of £ 3 million (approximately $ 4 million) from FSD Africa Investments. according to a press release.
The IMFact business model is a “pooled receivables†factoring platform, which means that mass invoices are being bought by micro and SMEs for both prepayments and deferred payments, the press release said. This gives sellers cash without waiting for bills to be paid. It also frees up capital to buy new inventory, pay suppliers, and grow the business.
This model differs from the pre-existing invoice discount style, where the company selects the best receivables or invoices while the rest of the release cannot be used as collateral. In addition, IMFact’s model allows for better access to working capital as there are no upfront payments or guarantees required.
Many of the companies that will benefit from investing in IMFact are family businesses that sell medical devices and medicines. IMFact will also work with other industries, according to the press release.
The IMFact will provide a total of £ 475 million (about $ 638 million) for around 570 companies over the next five years, supporting around 5,600 jobs, the press release said.
The aim of FSD Africa is to finance companies in Africa, which is lagging behind on average worldwide in terms of bundled receivables financing, according to the press release. Only South Africa has a significant factoring model. By contrast, Kenya, where the IMFact is based, had numbers below 2%.
“Building COVID-19, strengthening Kenya’s status as a financial services hub and creating jobs are at the heart of the UK’s strategic partnership with Kenya,” said UK High Commissioner for Kenya Jane Marriott in the press release. “We are pleased to support this investment by the FSDAi in IMFact, which the [SMBs] in Kenya to recover from the challenges of the pandemic. “
In other Kenya-related news, digital banking startup Kwara raised $ 4 million in seed rounds to develop its Neobank app and turn savings cooperatives into modern digital banks.
Continue reading: Kenya’s digital banking startup Kwara raises $ 4 million in seed money to set up a credit union
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NEW PYMNTS DATA: AUTHENTICATION OF IDENTITIES IN THE DIGITAL ECONOMY – DECEMBER 2021
About:More than half of US consumers believe that biometric authentication methods are faster, more convenient, and more trustworthy than passwords or PINs – so why are they using less than 10%? PYMNTS, in collaboration with Mitek, surveyed more than 2,200 consumers to better define this perception and usage gap and to find out how companies can increase usage.
