SMMEs – the Backbone of Africa

It is estimated that about 90% of registered businesses in Africa are SMEs. A large percent are micro-businesses, which also, of course, dominate the informal sector. EFSA believes that between 250-300,000 e-merchants operate in SA, most are SMMEs and use social media. Recently a new SMME Chamber was launched in SA dedicated to helping SMMES – https://smmechamber.africa/about-us/index.php. The encouragement of SMMEs is elsewhere too.

Kenyan fintech startup Asilimia, which is building the digital infrastructure to connect African SMMEs to the formal financial economy, has secured $2m to grow its team, deliver new services, and expand into new markets in East Africa. Founded in 2017, Asilimia is working to bridge the $500bn financing gap for growing enterprises, which are unable to get loans and other financial support due to a lack of proper financial records. It solves this by using the digital data that the SMMEs already have, which is verifiable, to solve the dual problems of accounting and financial inclusion.

The startup has just raised $1m in pre-seed funding from a wide range of investors, including unicorn founder Fredrik Jung Abbou (co-founder of Kry and Lendo), Norrsken Impact Accelerator, and other prominent founders from across Europe. It also raised $1m in a debt round that included Bpifrance and GreenTec Capital Partners. The pre-seed funding will support team growth and expansion, while the debt capital will enable Asilimia to extend credit to SMMEs, providing much-needed financing to help them scale their businesses.