Siya Ntutela launched Invoiceworx to provide credit to the financially excluded market using a unique credit risk assessment to help SME’s that face great challenges in accessing trade finance with an unmet demand of US $120 billion in Africa (one-third of the continent’s trade finance market) and US$700 billion in developing Asia.
Speaking to TechMoran Ntutela said Invoiceworx sources credit lines with big suppliers then offers them to small retailers. The firm then makes money by negotiating trade discounts with its suppliers on the inventory sold to the small retailers. Invoiceworx has now on boarded one big supplier and will be on boarding 10 more suppliers as it moves towards signing up 1000 small retailer in six months.
“Invoiceworx is an inventory financing platform that provides working capital to small retailers in the township, peri-urban and rural areas. The platform also facilitates cashless transacting between the suppliers and retailers,” said Ntutela. “This eliminate the cash in transit risk for the suppliers. ”
The firm negotiates credit lines and trade discounts with big manufactures by leveraging the buying power of the buying group (small retailers) then extends this credit to small retailers that wouldn’t have qualified in terms of the credit criteria from the big manufactures. When approved, the small retailer collects or takes delivery of the stock.
The small retailers make repayments at Invoiceworx payment points at Shoprite, Checkers, Pep and Boxer stores among others. The small retailer can check their balance and order more stock using an Unstructured Supplementary Service Data (USSD) code e.g. 120675#.
Invoiceworx’s main competition comes from commercial banks and other online platforms which unfortunately do not cater for the informal market. Partnering with big cooperate institutions is not easy but Ntutela says the firm is showing them that there is value in the informal market by highlighting the plight of the financially excluded at a world stage.
Invoiceworx is looking to raise capital soon and therefore sees its participation at Seedstars as relevant it at this moment as these might see cooperates and government open their doors to innovation and partner with local startups.
Ntutela’s journey has just began. After resigning from banking, he started a consultancy company that provided due diligence and credit analysis services. He consulted for SEDA and I.D.C on their prefunding activities and this highlighted to him the need for a micro-lender in the SME sector funding working capital, especially for those SMEs that are financially excluded from the financial system.