The small to medium-sized enterprise (SME) sector in South Africa is one of the strongest drivers of economic growth and job creation in the country. With over two million SMEs operating in the country, there is a growing movement of lending platforms which has been prevalent since the post-COVID era. These technology-driven platforms provide quick and low-cost financial vehicles for SMEs.
From fintechs to established businesses introducing lending products, there is now more than ever a plethora of funding channels for SMEs. One business that has introduced lending for business is Telkom, with its Telkom Lend offering.
In today’s article, we look at what Telkom Lend offers, what the requirements are and how SMEs can apply.
What is Telkom Lend?
Telkom Lend is a fast, digital, and unsecured lending product from Telkom Financial Services designed for South African SMEs. Launched in 2022 and underwritten by GoTyme (previously TymeBank), the financing mechanism leverages data analytics for evaluation, providing SMEs with a convenient alternative to traditional bank loans.
How to Qualify for Telkom Lend?
Telkom Lend offers unsecured funding solutions ranging from R50 000 to R5 million. Here is how it works.
Eligibility Criteria
To qualify for financing from Telkom Lend, your business must meet the following criteria:
- The business must have been actively trading for 6 months or more
- Must generate a minimum monthly revenue of R50 000
- Your business must be registered with the Companies and Intellectual Property Commission (CIPC)
- Must have a three-month bank statement
- Must have a valid ID, passport or work permit
Application Steps
These are the steps you need to follow when applying to Telkom Lend.
Step 1: You will need to go to the Telkom Lend portal, create an account or log in if you already have an account.
Step 2: Provide all necessary details, upload all required documentation and wait for an automatic response on eligibility. Once you have applied and submitted all required documentation, a preliminary review is done to confirm eligibility using an automated scoring model. If all is in order, Telkom will return to you with an offer.
Step 3: If you accept the offer and your application has been approved, the funds are deposited into your business bank account, all within 24 hours.
The funds can be used for any business need, such as purchasing inventory, upgrading equipment, or managing cash flow.
If you are interested in applying for financing from Telkom Lend, visit their website.
How do Repayments Work?
Telkom Lend uses a revenue-based model. This means repayments are tailored for each business’s cash flow. Repayments can be made over a period of 3 to 12 months, depending on your cash flow.
FAQs on Telkom Lend
These are some of the frequently asked questions (FAQs) concerning Telkom Lend. These FAQs are designed to help potential applicants understand the platform and lending products easily.
FAQ 1: Is Applying Free?
Yes, applying to Telkom Lend is free of charge. Also, there are no commitments or obligations required from the applicant during the application process.
FAQ 2: How are Loan Fees Calculated?
Fees are calculated based on your turnover, the duration of the facility and how often you would like to make repayments. Cash advance financing repayments can be paid between 3 and 12 months. These repayments can be made daily or monthly, your choice.
FAQ 3: How Do You Pay?
Telkom Lend uses a flexible repayment system designed to fit the needs of each business. During repayment discussions, you and Telkom Lend will enter into a sale and purchase agreement with your business to pay back as frequently as every day or as infrequently as every month.
FAQ 4: Is Early Settlement Possible?
Yes, Telkom Lend does allow you to repay your loan early. You will not be charged any penalties for early settlement, while also qualifying for repayment discounts.
FAQ 5: Why Does Telkom Lend Offer Unsecured Loans?
Unlike traditional bank loans that require collateral and lengthy approval processes, unsecured funding offers a faster, more flexible alternative – without putting your personal or business assets at risk. Telkom Lend’s unsecured funding is designed to fit the reality of the business, requiring no collateral, paperwork and quick feedback.
FAQ 6: Why Doesn’t Telkom Fund Early-Stage Businesses?
Telkom Lend works with businesses that have been trading for at least 6 months and have established a consistent revenue stream. This is done to ensure that the business which receives the funding can manage the funds effectively, use them for meaningful growth and be able to make repayments.
FAQ 7: Does the Business Need to be Registered to Qualify?
Yes, your business must be registered and have been operational for at least 6 months. Additionally, it should have a good credit standing and generate a minimum monthly revenue of R50 000.
FAQ 8: Why Should SMEs Choose Telkom Lend?
Telkom Lend offers a fully digital, end-to-end lending experience tailored for South African SMEs. With no collateral required, fast approval in as little as 24 hours, and complete transparency, you can apply in minutes, use your funds for any business need, and repay on terms that fit your cash flow
Tips for Improving Your Chances of Approval
If you decide Telkom’s unsecured loan is best suited for your business, follow these tips to increase the chances of approval.
Tip 1: Improve Your Credit Score
Having a credit account that you pay off every month will show lenders that you are trustworthy and able to make repayments on time.
Tip 2: Ensure You Can Pay Back the Loan
Before you apply, you should apply for an amount you know you can repay. If lenders find out you cannot repay, the chances of getting rejected will increase.
Tip 3: Pick the Right Financing
You know what kind of financial help your business needs. Before sending in your application, you need to know if you need revolving lines of credit, term loans, merchant cash advances or invoice financing.
The small to medium-sized enterprise (SME) sector in South Africa is one of the strongest drivers of economic growth and job creation in the country.… Read More
