VodaLend: Committed to SMME Success in South Africa

By Innovator Trust on 11 Jun 24

VodaLend: Committed to SMME Success in South Africa

Sitting with Mark Young, an insightful conversation centering on VodaLend demonstrates why Vodacom has been a leader in innovation in South Africa for 30 years. For over 25 years, Mark Young has navigated the dynamic landscape of African financial services with a keen eye on empowering businesses. As the head of Consumer and Business Lending at Vodacom Financial Services, his extensive background positions him as a true champion for SMEs seeking funding to thrive in the South African market.

How is VodaLend's unsecured funding different from secured loans?

Vodacom is in the business of helping SMMEs and their owners survive and thrive. VodaLend offers unsecured funding, eliminating the risk of asset repossession for business owners. This means you don't need to provide collateral like a car or equipment to qualify or be concerned about the threat of repossession.

What are the basic requirements to qualify for VodaLend funding?

Our qualification process is really straightforward. We require your business to have been operational for at least 12 months and have a minimum monthly turnover of R40,000. Additionally, your business should be formally registered with a bank account and at least one registered director.

What if income fluctuates monthly, but a business's annual turnover meets the requirement?

While a minimum monthly turnover of R40,000 is preferred, we understand that some businesses have seasonal income variations. We encourage you to apply if your annual turnover demonstrates a strong track record of meeting requirements.

Understanding the Assessment Process

What factors are considered beyond the credit score when applying for Vodalend funding?

The beauty of our assessment process lies in its multi-layered approach. We consider several key factors:

  • Baseline Requirements: These are the fundamentals we've outlined, ensuring you meet the minimum criteria – good governance is a crucial aspect here.
  • Creditworthiness: We conduct a credit bureau check on the directors and the business. This proven step offers valuable insight into a customer's financial habits and ability to manage repayments and cash flow.
  • Industry Fit:  We operate within specific sectors, and some, like gaming or adult entertainment, fall outside our scope.

Once all these boxes are checked, we present a clear funding offer. If you accept, the process is streamlined, and you can access the funds swiftly.

Why is credit score still crucial for the application?

Our credit assessment process considers historical credit bureau data to predict a customer's ability to repay consistently. While past performance is a factor, we understand that unforeseen circumstances, like the economic impacts COVID-19 four years ago, can affect businesses. Fortunately, credit bureaus primarily focus on the last two years of data, ensuring a more current and relevant assessment for your application.

Tips for Improving Your Credit Score

How can I improve my business credit score?

Making timely payments on all your business debts is crucial. Even a single late payment can stay on your record for 24 months.

Does applying to multiple lenders hurt my credit score?

Unlike consumer loans, shopping for SMME funding with multiple lenders won't negatively impact your credit score. In fact, it's expected that SMMEs will shop around.


Elaborate on Vodacom's relationship with Lulalend.

Vodacom Financial Services partners with Lulalend to manage the back-end operations and administration of VodaLend. This strong five-year partnership allows us to provide you with exceptional service.

Cost and Repayment

How much will the funding cost?

The cost of funding varies depending on your business's unique risk profile. We encourage you to apply to receive a personalised quote. It typically starts at around 25% of the requested capital.

What happens if a business can't make my repayments?

We understand that unexpected situations arise. VodaLend prioritises working with businesses to find solutions. Open communication is vital! If you foresee challenges, please get in touch with us to discuss repayment options or restructuring possibilities.

What options are available for businesses struggling to repay?

We offer flexible repayment options. In cases where your order book shows future income coming in but there's a temporary wait, we may restructure your loan and grant a short-term moratorium, such as a three-month pause in repayments. Again, this is determined on a case-by-case basis.

Comparison with Other Lenders

How do VodaLend's rates and terms compare to those of other lenders?

VodaLend offers competitive rates based on risk and market trends. Our fees are a set monthly amount, not an interest rate, making repayments predictable.

The Application Process

How long does the application process take?

The application itself takes only a few minutes to complete online. Once you submit your documentation, you can expect a response within 24-48 hours.

Are there penalties for early repayment?

There are absolutely no penalties for repaying your loan early. In fact, we welcome it! This is a sign that the business is healthy, and we want to see that.

How will we know about any fees associated with the funding?

VodaLend offers a transparent pricing structure. There are no hidden fees. You'll see a monthly installment covering both the capital repayment and our cost.


Is there support available for me after applying?

Absolutely! Our dedicated online and telephone support centre is staffed with experts to answer your questions. You'll receive all the support you need throughout the process.

Mark highlighted that Vodacom wants to be on the ground to understand the challenges SMEs face fully. "That's why we're here today – to listen to your feedback and thoughts on our current processes and identify opportunities to improve our VodaLend product and service offerings. While we have established guidelines, we value your insights on their effectiveness in today's business environment." With this in mind, Vodacom strives to see SMMEs scale and soar across South Africa.

>> Click here to watch the webinar <<

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