Nigeria’s first digital invoice factoring platform processes N300m payment in 30 days
As part of its efforts in helping micro, small and medium enterprises (MSMEs) access working capital, Nigeria’s first invoice factoring platform, Getcapsa, processed over N300 million payments through its platform in the last month, the company has said.
Incorporated in November 2019, the company’s platform, GetCapsa enables MSMEs to trade their unpaid invoices to corporate and individual investors for cash within 48 hours.
In Nigeria, finding working capital to sustain a business is challenging. The lack of funds, debt and delayed transaction fulfilment between business owners and customers contribute to this trend.
“Seventy-five percent of small businesses experienced delayed payment of at least 60 days after delivering product/services to private sector clients in Nigeria,” a PwC survey on MSMEs indicates.
The survey adds that this situation has severe impacts on the cash flow and revenue of these small businesses.
However, in the last eight months, Capsa’s unique platform is slowly solving the problem. Small and medium-sized businesses in Nigeria have traded unpaid invoices for immediate cash and at very competitive rates on getcapsa.com. As a result, the fintech company has processed payments that have provided access to funds for MSMEs amounting to over N300 million in the past month.
“The ability to secure quick and affordable working capital remains a huge struggle for most businesses, Getcapsa is fixing this with our innovative digital platform,” said Segun Dada, Co-founder/Chief Commercial Officer of Capsa.
“With just a few clicks, businesses can unlock much-needed financing and convert their waiting time to cash.”
Capsa achieved this transaction alongside its collaboration with the top multinational brand, Olam group, and financial institution groups, Stanbic IBTC Bank and Vetiva Capital.
Accessing loans from commercial banks, microfinance banks, and other financial institutions is usually an unfavourable, time-consuming process for small businesses.
It leaves them with little or no financing options, creating a huge financing gap in the MSME sector. But with Capsa’s solution, businesses that have unpaid invoices with long payment days can convert them to cash through the platform’s quick and seamless process in 48 hours or less, instead of taking complex, opaque, high-interest and high-risk loans that take up to four weeks for approval and funding.
“We are the next big thing coming out of the alternative financing space, and we are bringing more exciting and innovative ways for small businesses to fund their operations,” Mustapha Suberu, the co-founder/CEO of Capsa said. “We are allowing small businesses to access funds without taking loans from banks or other loan sharks out there and for the first time, businesses will have the power to determine what their financing cost would be with just a few clicks, and this is thanks to Getcapsa.”
For financiers and investors, Capsa provides a low risk, short term investment opportunity. Investors can purchase the claim to MSMEs’ verified invoices at a discounted rate and get their returns within 30 – 90 days. The company has developed an insurance feature that will allow investors on the platform to insure their investments with one of Nigeria’s leading insurers, providing additional cover for investors. This feature will roll out in September.
The blockchain technology on which Capsa is built provides multiple benefits for its users. It enhances the transparency of the system and secures the validity of data. Both buyers and sellers of invoices have access to real-time information with very minimal risks of fraud.