Sasfin invests millions in digital banking services for SMEs

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Sandile Shabalala, Sasfin’s managing director of business and corporate banking.

Financial Services Group Sasfin has deployed over R215 million in capital to pilot its new digital banking services for SMEs.

In 2020, the group, which says it offers services “beyond banking”, announced a war chest of 750 million rand from FMOthe Dutch Development Bank, to take its digital banking business to the next level and expand its SME loan offerings for underserved businesses.

Sasfin is a banking supervisory company that offers a range of financial products and services to businesses and “high net worth” clients. Its financial products and services focus on the needs of entrepreneurs, businesses, institutions and high net worth individuals.

In an email interview with ITWeb, Sandile Shabalala, Sasfin’s managing director for corporate and commercial banking, said that while the growth of South Africa’s SME sector has often been cited as a potential panacea to economic difficulties of the country, these small businesses generally find it difficult to access a full range of business-friendly banking products.

In response to this challenge, the financial institution introduced the Beyond the digital banking platform and develops a digital exchange platform.

“These platforms complement the relationship banking model that targets the SME segment. The Beyond Banking digital platform provides convenience through general online/mobile banking and other value-added services, such as Accounting Lite, Xero and payroll services.”

The digital exchange platform will offer general online/mobile forex banking, including trading, he notes.

“We are looking to deploy more investment and resources in developing and improving our digital platforms, as we expand our customer acquisition strategies by focusing more on primary banking services and customer acquisition. businesses with more complex digital banking requirements,” says Shabalala.

The company adds that its significant investment in digital capabilities has enabled it to transform the way it works, which has resulted in the growth of its business segment to a total of 2,471 customers and 75% year-on-year growth. on the other.

In its December 2021 interim results, Sasfin reported 100% profit growth, Shabalala adds.

Accelerate loan processes

In 2020, Sasfin also secured a R390 million line of finance, as well as a $35 million (approximately R600 million) loan guarantee facility from FMO to provide loans to women, youth , migrants and businesses affected by COVID-19.

This has helped her continue to build her lending capabilities in Asset Finance and Sasfin Capital, which together with Nasira ensure the financial services group is well placed to fund businesses critical to the growth of South Africa’s economy. .

According to Shabalala, key challenges facing financial institutions in today’s digital economy include meeting and exceeding customer expectations, competing with non-banking and fintech companies, leveraging big data and data security, and slow lending processes for SMEs.

Shabalala, who was the launch CEO of digital-only bank TymeBank, is resolute in his desire to change this status quo, noting that he has already identified ways and means for Sasfin to expand its corporate banking offerings for this segment. underserved but vitally important to the economy.

Sasfin is building more capabilities within frontline companies to tap deeper into data to improve its revenue opportunities, while becoming more proactive in understanding and meeting customer requirements, he says.

“SMEs need solutions that create value through simplified customer service interfaces and with a single point of contact. Having access to this level of understanding, banks will ease an entrepreneur’s mind, while giving them access to a range of financial products and services that will help them maintain and grow their operations.

“When it comes to accessing finance, SMEs need relevant products with simple processes that are completed with as few touchpoints as possible, so they can get quick decisions that allow them to make the best choices for their business,” he said.

McKinsey to research found that slow bank lending processes, such as insistence on paper documentation and branch visits, were to blame for slow adoption by SMEs of the COVID-19 loan guarantee program.

These slow processes, Shabalala comments, are typical of many applications and transactions in the South African banking sector, which pose a significant barrier to accessing much-needed funding.

“These factors are at play in the day-to-day operations of SMEs, and not just under the COVID-19 loan guarantee program. When your working day is dedicated to the survival of your business, there’s no time to fill out forms, get documents certified, or wait in line during limited banking hours.

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