Benefactors CEO Olivia Zank on easing SMEs access to funding

Access to finance has long been a significant obstacle to the growth of Small and Medium Enterprises (SMEs) in Rwanda, particularly in the agribusiness sector. Benefactors CEO, Olivia Zank, is pioneering innovative solutions to help SMEs overcome cash flow issues through factoring services. Factoring is a financial product that offers short-term working capital to companies with established supply relationships, allowing them to receive advances on pending invoices. Zank explains that Benefactors steps in to provide the advance on the invoice, and the buyer eventually pays them directly, enabling smaller companies to stabilize their cash flow and seize growth opportunities while waiting for payments. In a recent interview with CNBC Africa, Zank discussed the success of Benefactors in Rwanda's agribusiness sector. Since the inception of the company a year and a half ago, they have focused extensively on agribusinesses, recognizing the sector's immense potential for growth and job creation in Rwanda. Zank emphasized that many agribusinesses have traditionally struggled to access financing, making factoring services a critical lifeline for these underserved companies. One of the key distinctions of factoring from traditional loans, as elucidated by Zank, is its holistic approach. While banks typically assess a borrower's financials, collateral, and experience, factoring providers like Benefactors analyze the entire value chain. By evaluating the reliability of the buyer and the likelihood of invoice payment, factoring opens doors for companies that may lack conventional loan prerequisites. Zank's innovative approach aims to bridge the financing gap for SMEs and agribusinesses, fostering inclusive economic growth in Rwanda. Zank also delved into the regulatory environment and the rise of fintech solutions in Rwanda. She commended the Central Bank of Rwanda for its supportive stance on fintech innovation, which has facilitated the growth of digital financial services in the country. With a burgeoning demand for various financial products and services, Rwanda presents a ripe market for fintech providers like Benefactors. Zank highlighted the importance of collaboration between regulators and industry players to ensure a stable and conducive environment for financial innovation. However, despite the progress in the fintech sector, challenges persist in the agribusiness landscape. Zank pointed out that certification hurdles pose a significant constraint to growth, particularly concerning product quality and adherence to certification standards. Inaccuracies or deviations from certification requirements can jeopardize invoice payments and hinder the financing process. Addressing these quality control issues remains a critical priority for Benefactors to sustain and expand their support for agribusinesses. As Benefactors continues to drive financial inclusion and empower SMEs in Rwanda, Zank's visionary leadership underscores the transformative potential of factoring services in catalyzing economic development. By leveraging innovative financial solutions and forging strategic partnerships, Benefactors aims to unlock cash roadblocks and foster sustainable growth for agribusinesses and SMEs in Rwanda's evolving economic landscape.