Zelo, formerly eFunder, offers working capital funding for small businesses
Dubai: The Abu Dhabi investment giant IHC has bought out the SME financier eFunder. The platform, which offers private financing for SMEs, will now be known as ‘Zelo’.
Small and mid-sized businesses in the UAE and Saudi Arabia are getting access to critical short-term funding from sources other than banks and government-backed lenders.
"While SMEs account for over 95% of the UAE’s registered businesses and generate more than half of national GDP, many face delays of 60-120 days in receiving payment for approved invoices restricting growth and operational agility," said a statement from IHC.
This is what entities such as Zelo are trying to address offering loans against invoices, etc.
Zelo which launched in August 2020, offers clients receivables-based funding to help with SMEs’ working capital needs. Zelo provides ‘digital-first access to liquidity by converting approved invoices into working capital within 24 to 48 hours’.
“SMEs are the backbone of a diversified and future-ready economy," said Syed Basar Shueb, CEO of IHC. "Through our acquisition of Zelo, we are proud to support a platform that solves one of the most fundamental barriers facing SMEs - access to timely working capital."
At a time when bank lending rates are still sticking to higher levels, private credit and private financing is crucial for businesses, big and small. In Saudi Arabia, Sukna Capital launched a fund this week targeting easier financing options for SMEs and startups.
There is an estimated $250 billion SME credit gap across the Middle East and North Africa.
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