Financial Solutions

LSC is set up to assist SMEs in their short-term financing requirements, specifically relating to procurement. Initially the fund focused on invoice discounting and purchase order financing.

The Fund has an operational process that incorporates a direct link between the relevant paymasters and the supplier, to ensure the validity of the order and specifications of the goods to be supplied. The Fund manages quality control and ensures that all connected parties accordingly receive specified funds once the order is delivered.

Purchase Order Funding is critical to help black beneficiaries process orders, even if they do not have the cash-flow. Both the Corporate preferential procurement and the black-owned supplier benefit from such financing.

In the process of assisting the beneficiary with short-term financing, it is paramount that strict procedures, with respect to documentation and payment controls, are adhered to. This risk-management, together with the beneficiary relationship, is the reason that the fund can achieve a default rate of less than 2%.

Support & Development

Support & Development LSC’s key role players have evidenced a successful and profitable track record over the last 5 years. A reliable client base, together with strong internal controls, are the backbone of the fund’s success.

The fund supports local black-owned SMEs with their short-term financing requirements, as well as monitor their working capital cycle, to ensure the sustainability of their business. A further core benefit is the business development support provided by LEAP which essentially gives the beneficiary the opportunity to migrate from a preferential lending environment to a self-sustainable commercial environment. LSC provides continuous guidance and mentoring to the lenders to make their businesses more sustainable and allow the fund to have a greater impact on small businesses in South Africa.

The Fund further provides the opportunity for the SME to trade with large corporates, which they previously could not do. Large corporates benefit with respect to ESD spend and preferential procurement, which is advantageous to the corporate, the black beneficiary and the South African economy.

The company is considered an essential service and may operate during all levels of lockdown due to the COVID-19 pandemic.

We Need Your Support

The LSC Fund requires further funding to grow this fantastic initiative. LSC has an available pipeline of lenders, consisting of pre-approved customers.

LSC is passionate about changing the landscape of SME lending in South Africa. The massive incongruencies with respect to lending rates between small business and established corporates is the primary pain-point that we are consistently addressing.

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