Bridging the Information Divide in African Lending

The financing gap for small and medium-sized enterprises (SMEs) in Africa isn’t simply about a shortage of capital—it’s an information problem. While banks, venture funds, and other lenders have resources available, many promising businesses fail to connect with them because they lack the financial visibility needed for assessment.

This disconnect stems from how SMEs operate: transactions often occur across multiple platforms without centralized reporting. A thriving business might generate regular revenue but appear risky due to fragmented data—invoices in one system, bank statements in another, and payroll records elsewhere.

Turning Data into Financial Signals

Several initiatives are addressing this challenge:

  • African Bank is working to transform unstructured small-business activity into usable financial information by offering integrated services that go beyond traditional lending—including payroll management, tax support, and invoice discounting.
  • 22 On Sloane’s KUMii platform uses AI to help startups discover funding opportunities across Africa’s fragmented investment landscape.

The need for better business legibility is particularly acute in South Africa, where an estimated $21.6 billion financing gap exists despite a growing number of lenders (more than 300 as of 2025).

As Edna Sathekga-Montse, African Bank’s Chief Transformation Officer, explained at the GEC+Africa summit: “Lenders need to understand businesses better to assess affordability and risk appetite.” The data is often already there—in invoices, transactions, payroll records—but needs to be integrated into a comprehensive financial picture.

Beyond Digitization

While digital adoption helps, it’s not a complete solution. Even though 80% of South African SMEs use digital financial services, only about half have consistent internet access or online presences.

The real opportunity lies in building infrastructure that transforms economic activity into verifiable information—allowing lenders to see the full story of businesses across Africa.