Payment gateway provider, Pesapal, has announced its entry into the credit market with the rollout of Pesapal Credit targeting small businesses.
The loan product in partnership with Sokohela will see Pesapal merchants who are majorly small and medium enterprises (SMEs) access flexible loans with payment period of up to one year.
“SMEs are the engine of our economy, but they often face difficulty accessing credit due to high-interest rates, stringent collateral requirements, lengthy procedures, and lack of financial records. We understand these challenges and have partnered with Sokohela to address them. We’re all about our merchants being confident with their financial decisions and becoming world-class at what they do – regardless of their size,” said Agosta Liko, Pesapal Founder.
Accorfing to Sokohela Chief Executive Officer Nickson Onyango, the partnership with Pesapal is a strategic move to leverage payment gateway’s extensive network of merchants and customers across various sectors, such as hospitality, retail, education, and travel.
“Our partnership is a testament to the power of collaboration in driving innovation and growth in Africa’s digital economy. We are confident we will unlock new capital streams for SMEs, enabling them to scale efficiently. We are excited to partner with Pesapal, a trusted and reputable payment service provider in Kenya. Together, we aim to reach out to more SMEs and offer them convenient and affordable credit solutions that suit their needs. We believe that by doing this, we are supporting SMEs and our country’s social and economic development,” said Onyango.
Pesapal says the credit product which does not require borrowers to have collateral will use digital scoring for loan approvals as well disbursement via the Pesapal platform.
“We design our tools on the Pesapal platform to help entrepreneurs achieve their business goals without overextending. Finance terms are transparent and easy to understand, supporting comfortable repayment management,” added Agosta.
The merchant credit solution is powered by Pesapal’s proprietary credit scoring algorithm that analyzes the transaction data of SMEs from various sources, such as mobile money, e-commerce platforms and POS systems.
This allows the firm to offer customized and affordable loans to SMEs based on their cash flow and business performance.
