USA Investor In African Microfinance Institutions (South Africa)

21 May 2019
Retail Capital

Market study validating a debt investment into Retail Capital

Developing World Markets (DWM) is a U.S. based asset manager which invests in microfinance institutions and other socially motivated organizations in emerging and frontier markets. DWM completed a debt investment into Retail Capital, a South African specialist SME microfinance lender.

We assessed the political, economic and currency backdrop in South Africa, helping DWM navigate macro risks associated with the investment. We also assisted in identifying additional investment targets in Sub-Saharan Africa.

The investment enhances access to working capital finance for SMEs in the retail and restaurant sectors. The company offers an innovative financing model that links loan repayments to a company’s revenue cycle, rather than requiring fixed loan repayments. Lack of access to working capital funding is one of the main causes of SME business failure in South Africa.

This engagement was executed through USAID’s Southern Africa Trade and Investment Hub