Addressing The Finance Gap: How FinTech’s Will Empower SME Success | IT News Africa | Business Technology, Telecoms and Startup News

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Mariam Cassim, CEO of Financial and Digital Lifestyle Services, addresses the finance gap and stresses the need to extend support to SME's towards the recovery of the South African economy. Fintech SMEs economicgrowth

Small and medium-sized enterprises are undeniably a driving force behind economic growth, innovation, and job creation, particularly in developing markets. Across the globe, the formal SME sector alone accounts for over 50% of employment opportunities, and these figures soar even higher in Africa, with 60% in South Africa and a remarkable 80% across the continent.

In South Africa, this predicament has been further compounded by the ongoing power crisis, characterized by load-shedding, which forces many SMEs to halt their operations for extended periods. In an economic downturn, these businesses often reduce expenses, leaving the catering company with fewer clients. Furthermore, the company faces the added challenge of delivering orders during load-shedding, especially if they lack the capital to invest in backup power solutions.

Referred to as the “finance gap” by the International Finance Corporation , an estimated 40% of formal SMEs in developing markets face an unmet financing need of a staggering R94 trillion yearly.

 

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