SME-focused South Africa-based digital lender Lulalend has secured $35 million in a Series B funding round led by Lightrock.
New investors DEG, Triodos Investment Management, and Women’s World Banking Asset Management also took part in the round along with existing investors The International Finance Corporation (IFC) and Quona Capital.
Founded in 2014, Lulalend claims it is South Africa’s first online provider of funding for small and medium-sized enterprises (SMEs). With its credit scoring algorithm, Lulalend says it leverages data from a set of alternative sources to quickly and accurately assess business health, review applications, and disburse funds “in hours” as opposed to weeks or months.
Targeting over two million SMEs in the country, Lulalend also offers a neobanking proposition called Lula, which provides bank accounts for SMEs, an AI-led cashflow management tool, and real-time access to funding via its lending solutions.
With the fresh funding, Lulalend will look to increase the size of its loan book, develop new products, and invest in technology and talent to roll out Lula. Additionally, in partnership with Women’s World Banking Asset Management, Lulalend will work to scale its product to women-owned SMEs in the region.
Trevor Gosling, co-founder and CEO of Lulalend, says South Africa’s SME sector is “critical”, as it accounts for almost 40% of the country’s GDP and 60% of private sector employment.