Retail Capital

About Retail Capital

Retail Capital operates as a key financial partner for small and medium-sized enterprises (SMEs) in South Africa, a sector vital to the nation's economy. Founded in 2011 by Karl Westvig, Stephen Leonard, and Dave Lewis, the company was established to address a significant gap in the market: the difficulty SMEs face in securing working capital from traditional banks. Westvig, a statistician by trade with a background in building major finance companies like DirectAxis and RCS Group, brought extensive experience in consumer and SME credit to the venture. His entrepreneurial journey includes founding a venture capital fund and leading various financial service firms, giving him a deep understanding of the challenges and opportunities in the sector.

The firm provides unsecured business funding, primarily through merchant cash advances. This model involves providing a lump-sum payment to a business in exchange for a percentage of its future turnover. Repayments are designed to be flexible, directly linking to the business's cash flow cycles; if turnover decreases, the repayment amount also adjusts, a feature that proved critical for clients during the COVID-19 pandemic. This approach differs from fixed-term loans, offering a partnership model where the company shares in the ebb and flow of the client's business. Revenue is generated from the agreed-upon total repayment amount, which includes the principal and a flat fee, avoiding traditional interest charges.

To qualify, businesses generally need to be operational for at least six months and demonstrate a monthly turnover between R50,000 and R10 million. The application process is streamlined and digital, allowing for rapid access to funds, often within 48 hours of approval. Retail Capital serves a wide array of industries, including retail, restaurants, and wellness. A significant milestone occurred in December 2022, when TymeBank, a fast-growing digital bank in South Africa, acquired Retail Capital for R1.5 billion. The acquisition has allowed Retail Capital to operate as a division of TymeBank, expanding its reach and bolstering the bank's business banking and lending offerings, while retaining its brand and leadership.