Distributors and suppliers can now access short-term mobile loans from lender Stanbic Bank, after the launch of a new automated supply chain financing platform.
The M-jeki is aimed at facilitating timely and tailored short-term lending to distributors and suppliers based on client needs, backed by a robust technology platform that enables convenient delivery of financing through mobile money.
The launch follows a successful pilot with Safaricom dealers and agents, during which they were provided with automated short term business loans to finance M-Pesa float, airtime, and devices. Over the last 12 months, 314 agents and dealers accessed short term loans to the tune of Sh10.3 billion.
“This speaks to our purpose as a bank to facilitate the growth of Kenyan businesses through tailored solutions that are aligned to the needs of our clients and their value chains,” head of business banking at Stanbic Bank Kenya, Thomas Bisonga said.
The solution was inspired by feedback from distributors and suppliers, whose constant pain points include having to wait for the requisite 30 to 90 day period before invoices mature for payments to be made and retailers who struggle to purchase products due to working capital constraints. With M-Jeki, payment can be accessed without having to wait, as long as the suppliers and distributors have trade documentation in the form of LPOs and invoices, which serve as collateral.
With this solution, a manufacturing client, for instance, can pay farmers who supply the raw materials and get instant credit for the products sold to their distributors with the final product being sold by retailers.
The bank has now partnered with Virtual City, a Kenyan fintech, in order to build a more robust and scalable platform to support multiple value chains in multiple business sectors. The platform will run on Microsoft technology and will enable efficient processing of loans and rate borrowers based on their transactional account behaviour, through a Behavioural Rating Index. The solution will be accessible through App, Web channels and Unstructured Supplementary Service Data (USSD).
Bisonga said that at the moment, there exists a KSh2 trillion lending gap within the SME sector in Kenya, which Stanbic Bank is keen to bridge through bespoke solutions such as M-Jeki.
“Ultimately, we intend to build a scaled-up product that is relevant and attuned to the entire spectrum of the SME sector, from FMCG to energy and the other sectors. In this way, we will be able to power their growth into the next generation of corporates,” he added.
