An SMME’s path to traditional funding channels is hardly ever smooth and most growing start-ups will require a form of alternative funding before reaching a stage where they can approach mainstream banking institutions for a business loan.

It is a cruel irony however as it is at the start-up phase, that new or small companies need funding the most however these entities often don’t meet the stringent lending criteria enforced by banks and many other credit providers.

Usually, when scoring a company to determine whether they are credit-worthy, banks will consider the company’s history and track record, which includes the company’s financial statements, as well as the credit history of the owners and directors. However, for start-ups, these aspects are often lacking and funding requests are declined without the lender even considering the potential benefits of the transaction the business presents.

Ecsponent’s funding solutions aims to disrupt this criteria model by providing funding solutions that help small businesses grow. Here is how you can benefit from Ecsponents SMME funding solutions as a small business owner.

Credible transactions

First and foremost, Ecsponent looks at transactional risk and the history, security and financials of the applicant becomes a secondary consideration. The model funds purchase orders, issued by reputable businesses, local, provincial or national government organisations and state-owned enterprises (SOEs). It adds value to the transaction by providing guidance relating to profitability, supply chain and risk to ensure that risks are mitigated and that a streamlined delivery process ensues.

This funding modal benefits the small business by resulting in:
• improved cash flow
• a financial solution for growth
• increased sales and profitability
• heightened reputation with clients
• improved operating capacity
• flexible repayments
• timely delivery to customers
• no missed opportunities
• the ability to meet seasonal requirements.

Smoothing an SMME’s path to traditional funding channels

Ultimately, Ecsponent aims to reduce the common funding challenges faced by SMMEs such as the risk and consequences associated with late payments by corporate contractors, as well as the red tape encountered when working with corporates.

Find out more about Ecsponent’s SMME funding solutions.