Retail Capital

Retail Capital operates as a key financial partner for small and medium-sized enterprises (SMEs) in South Africa, a sector vital to the nation's economy. Founded in 2011 by Karl Westvig, Stephen Leonard, and Dave Lewis, the company was established to address a significant gap in the market: the difficulty SMEs face in securing working capital from traditional banks. Westvig, a statistician by trade with a background in building major finance companies like DirectAxis and RCS Group, brought extensive experience in consumer and SME credit to the venture. His entrepreneurial journey includes founding a venture capital fund and leading various financial service firms, giving him a deep understanding of the challenges and opportunities in the sector.

The firm provides unsecured business funding, primarily through merchant cash advances. This model involves providing a lump-sum payment to a business in exchange for a percentage of its future turnover. Repayments are designed to be flexible, directly linking to the business's cash flow cycles; if turnover decreases, the repayment amount also adjusts, a feature that proved critical for clients during the COVID-19 pandemic. This approach differs from fixed-term loans, offering a partnership model where the company shares in the ebb and flow of the client's business. Revenue is generated from the agreed-upon total repayment amount, which includes the principal and a flat fee, avoiding traditional interest charges.

To qualify, businesses generally need to be operational for at least six months and demonstrate a monthly turnover between R50,000 and R10 million. The application process is streamlined and digital, allowing for rapid access to funds, often within 48 hours of approval. Retail Capital serves a wide array of industries, including retail, restaurants, and wellness. A significant milestone occurred in December 2022, when TymeBank, a fast-growing digital bank in South Africa, acquired Retail Capital for R1.5 billion. The acquisition has allowed Retail Capital to operate as a division of TymeBank, expanding its reach and bolstering the bank's business banking and lending offerings, while retaining its brand and leadership.

Keywords: SME funding, business financing, merchant cash advance, working capital, South Africa, fintech, alternative lending, small business loans, unsecured funding, business cash advance, TymeBank, Karl Westvig, flexible funding, asset finance, business growth, SME support, financial services, digital lending, entrepreneurship funding, revenue-based financing