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How Lulalend uses technology to make SME funding more accessible

South African Fintech company Lulalend is spearheading the digital revolution towards easier access to finance.

Access to funding remains a major challenge for South African SMEs. According to Finweek, many small businesses who are eligible for funding are still unable to secure the finance they need. In fact, the credit gap for SMEs in South Africa currently stands at $23 billion (source: SME Finance Forum).

Finweek identified Lulalend as one of the digital lenders gaining traction in the local marketplace to help solve access to finance challenges. The company, which launched in 2014, recently announced an additional round of investor funding to the tune of $6.5 million.

With Lulalend, customers can apply for a business credit facility online in just eight minutes and have a decision in under 24 hours. Applicants can access their funding immediately once a decision has been made.

For cash-strapped SMEs frustrated by the red-tape, lengthy decision-making periods and low approval rates associated with traditional lending, this instant access to business finance can be crucial.

“At Lulalend, we want to support locals SMEs as much as possible and have eliminated most of the obstacles that prevent entrepreneurs from accessing finance,” explains Lulalend CEO and co-founder, Trevor Gosling. “Unlike traditional lenders, we want to say yes as much as possible, which is why we’ve kept our online application simple and paperless.”

One of Lulalend’s core values is to empower small businesses across South Africa by opening up access to capital. It achieves this through technology.

Lulalend uses state-of-the-art artificial intelligence (AI) models to accurately predict how much finance a customer can lend without overexposing the client to risk. By using machine learning, for example, the company can find trends most banks would have overlooked entirely to determine real business performance, without the necessary paperwork to prove it. 

“We’re far more likely to take a chance on SMEs than the big banks,” explains Gosling. “We actually take an interest in what our customers are doing and want to see them succeed.”

Lulalend’s business credit facility allows customers to access a line of credit as and when they need it, without having to reapply. Customers only pay for the amount they use, when they use it. For seasonal businesses that experience slower trading months over winter, for example, a business credit facility can mean the difference between a good month and a disastrous one.

To qualify for Lulalend’s business credit facility, businesses need to have been trading for at least one year and have an annual turnover of R500 000. The application takes place online and is entirely paperless.

Lulalend is a proud Partner of the NSBC.