South African fintech company Bridgement has secured R330m ($20.3m) in funding from Rand Merchant Bank and Standard Bank, a move that underscores traditional lenders’ willingness to back technology-driven models as they seek to close a stubborn financing gap for small and medium-sized enterprises.
The capital will be used to scale Bridgement’s direct lending to SMEs and strengthen its position in an online business loan market that has grown rapidly by using artificial intelligence to assess creditworthiness, the company said in a statement on Friday. The deal also highlights how established banks are partnering with fintechs to serve a segment that has long struggled to meet conventional collateral and documentation requirements.
South Africa’s SME sector accounts for roughly 40 per cent of gross domestic product and employs about 60 per cent of the workforce, according to data cited by the banks. Yet an estimated R350bn to R386bn financing shortfall persists, largely because traditional credit assessments depend on audited financial statements, tangible collateral and predictable cash flows — conditions many smaller businesses cannot satisfy.
Bridgement, founded in 2016 by Daniel Goldberg (who serves as the CEO) , has built a proprietary platform that draws on live financial data from bank accounts, accounting software such as Xero and Sage, and other digital sources to build a real-time picture of an applicant’s performance. By analysing thousands of financial and operational data points, its system generates credit decisions faster than manual processes, often within minutes, and without requiring the same level of asset backing.
The company says it has already disbursed more than R2bn in business loans to South African SMEs since launch. Repayment structures are designed to align with the irregular cash flows typical of smaller enterprises, a feature that helps overcome one of the main obstacles to conventional bank finance.
“SMEs don’t need more paperwork — they need faster access to capital,” said Daniel Goldberg, founder and chief executive of Bridgement. “By using AI to analyse live financial data instead of relying solely on traditional lending processes, we’re helping more businesses access the funding they need to grow.”
The fresh funding will expand Bridgement’s loan book and support the company’s ambitions to license its technology to other banks and corporates, enabling them to offer AI-powered lending tools to their own SME clients.
The backing from two of South Africa’s largest banking groups signals a deepening acceptance of data-driven credit models in a market where innovation has been slower to take hold than in consumer lending. Xolela Albert, leveraged finance lead transactor at RMB, said the bank had been a funding partner to Bridgement for several years and had “seen the business consistently execute on its vision of improved financial inclusion in South Africa.”
Standard Bank’s participation, meanwhile, adds a second pillar of institutional support that could help Bridgement broaden its reach. Both lenders stand to benefit from exposure to a platform that addresses a segment they have historically found costly to serve at scale.
While the fresh capital marks a milestone for the fintech, the effectiveness of AI-driven lending models in South Africa’s volatile economic environment remains an area to watch. Loan performance during downturns, data privacy considerations and evolving regulation will test whether faster credit decisions can be sustained without a rise in defaults. For now, however, the commitment from established banks suggests that the promise of technology to reshape SME finance is being taken seriously at the highest levels.