- South African fintech startup, Lulalend, has raised $35 million in a Series B round to launch new products and expand its loan book.
- Lightrock led the round, with DEG, Triodos Investment Management, Women’s World Banking Asset Management, the International Finance Corporation (IFC), and Quona Capital also participating.
- In collaboration with Women’s World Banking Asset Management, the company will work to scale its product to women-owned SMEs in the region.
Lulalend, founded in 2014 by Trevor Gosling (CEO) and Neil Welman (CTO), provides funding for South African Small and Medium Enterprises (SMEs).
Because business owners couldn’t visit banks to open accounts or conduct transactions due to the pandemic, the idea of introducing customers to additional financial services was born.
In partnership with Access Bank, the digital lender now offers its customers Lula, a credit-led neobanking solution to open bank accounts.
The company believes opening bank accounts will help businesses access additional benefits, including cash flow management and capital.
Lulalend also provides an AI-driven cash flow management tool and funding via existing funding solutions.
The startup uses an online application process and internal credit metrics to provide short-term loans to small and medium-sized businesses that are often unable to obtain working capital.
The internal card metrics are a proprietary credit scoring algorithm and a diverse set of alternative data sources.
According to Lulalend, based on these credit metrics, it can distribute funds in hours rather than weeks or months. It also claims to have disbursed billions of rand to South African small businesses.
Lulalend also embeds credit solutions in partners to help them scale.
The company will use the funds to invest in technology and talent to accelerate the launch of its new digital business banking proposition.