How Kenya’s Paylend is helping MSMEs better record data and access loans

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Kenyan fintech startup Paylend, which is helping MSMEs better record data and access loans, is conducting surveys in Tanzania and Nigeria ahead of beta tests in those markets.

Founded in 2019 by Bendon Murgor and Eliutherius Juma, Paylend is digitising the manual, black book recording of data traditionally used by MSMEs.

“Loss of the book or tampering with records becomes a source of conflict, leading to poor business relationships and huge loss of revenue. This is the biggest problem that Paylend aims to solve,” Juma told Disrupt Africa.

“Most MSMEs in Africa experience stunted growth due to poor recording of their daily transactions. We identified a culture that exists in the African market where shopkeepers give credit to their customers, who pay back within a week or a month. These customers most of the time tip the shops. The shops record these transactions on paper, a practice that is tedious and bulky. Paylend intends to digitise this process and additionally add the shop’s cash payments transactions, enabling the shops to understand their actual value and stand a chance to expand by leveraging on accurate data.”

With Paylend, business owners can access proper transaction documentation, enabling them to be bankable and giving them an advanced method for credit management.

“Paylend is more of a complementary tool than a competitive one to the other financial products since it provides data that can help other stakeholders to make wise decisions and drive more business on their end,” said Juma. “For instance, taking advantage of Paylend’s data, banks  can be able to identify potential shops to offer loans. Additionally, insurance companies can create policies to offer insurance for the credits that the shops give their customers at a monthly fee.”

In its home market of Kenya, the startup has over 6,500 customers accessing goods and services, or redeeming vouchers, via mobile app and USSD. So far, it has on-boarded over 2,000 premises. The startup, which charges a percentage of a customer’s subscription fee to a shop, as well as withdrawal fees and commissions, is actively working on expanding to other markets.

“We plan to expand to Nigeria, Tanzania, South Africa and Zambia. We are already conducting surveys in Tanzania and Nigeria in preparation for a beta test in the last quarter of 2021. By the end of 2022, Paylend will be operational in three different markets – Kenya, Tanzania and Nigeria,” said Juma.

This expansion will leverage on the presence of Adalabs, Paylend’s incubator, in these markets. The startup is also in the process of engaging VCs to raise a seed round over the next few months. 

“Paylend has already done a proof of concept, and we are at the point of scaling. The greatest difficulty has been funding, but more opportunities are currently emerging,” Juma said. “I am optimistic about getting the funds we need to scale and become pan-African in the next couple of months.”

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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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