SA’s Merchant Capital has helped 7,000 small businesses access $87m in loans


South African fintech startup Merchant Capital has provided over ZAR1.5 billion (US$87 million) in funding to more than 7,000 businesses since its launch in 2012.

Founded to address the funding gap experienced by small business owners looking to grow, Merchant Capital provides SMEs with quick, simple access to unsecured working capital.

Its tailor-made working capital cash injections for growing businesses provide a flexible, rapid and secure funding solution, which addresses the cash flow and working capital restrictions of retail SME business owners. 

Business owners apply digitally, and can be approved within 24 hours. Merchant Capital then enables flexible repayment terms to be agreed upfront with the business owner – customised to take their specific business requirements into account. Qualifying merchants are provided with an upfront lump sum in the form of a cash advance in exchange for a small fixed percentage of future turnover. 

“Merchant Capital’s expertise lies in providing working capital solutions for businesses in various retail sectors including restaurants and hospitality, fuel retail, health and beauty, fashion retail, jewellers, hardware stores and supermarkets,” Dov Girnun, the company’s founder and chief executive officer (CEO), told Disrupt Africa.

The company, which has raised equity and debt funding from some major institutional players, has so far provided over ZAR1.5 billion (US$87 million) in funding, assisting over 7,000 South African businesses to date, but Girnun said gaining traction in the early days was a challenge as the product was perceived as being “too good to be true”.

“The response from the market was initially slow as there was a huge education process required. The vast majority of South African SMEs have not heard about this type of alternative funding. This has made it difficult to scale from inception,” he said. 

“In the last couple of years, as the product and business gained traction, the take-up has improved but there is still a long way to go until it is considered a mainstream lending product for SMEs looking to grow their business.”

Merchant Capital continues to launch a host of new offerings and products to encourage this uptake. In recent months it has partnered Standard Bank Shari’ah Banking to launch a Shari’ah funding product, partnered Discovery Insure to provide SMEs with working capital to assist with cash flow, and launched an innovative short-term finance product in Finland to give the hard-hit restaurant sector a much-needed injection of capital to help ease the economic impact of the national lockdown regulations.

With so much room for growth at home, the company is not looking any further afield for now.

“There is still a massive opportunity in the local market,” Girnun said.


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Passionate about the vibrant tech startups scene in Africa, Tom can usually be found sniffing out the continent's most exciting new companies and entrepreneurs, funding rounds and any other developments within the growing ecosystem.

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