Bridgement Accelerates Access to Funding for South Africa’s SMEs Amid R350bn Gap

South Africa’s small and medium enterprises (SMEs) play a crucial role in the economy, contributing 40% to the country’s GDP and employing 60% of the workforce. However, these businesses face a significant funding gap estimated at R350 billion. The existing funding models, which were designed for larger enterprises, often overlook the unique needs of SMEs. As a result, many successful SMEs with established track records are being denied the funding necessary for expansion and critical infrastructure investments.

Bridgement’s Role in Addressing Funding Challenges

Founded in 2016, Bridgement aims to bridge this funding gap by addressing both specific and structural challenges faced by SMEs. Traditional financing often fails to meet the needs of these businesses, leading to frequent rejections. Bridgement has developed a diverse range of financial products tailored to the cash flow realities of SMEs, including business loans, revolving credit, and invoice finance options.

One of the primary issues is the disconnect between profit and cash flow. A business may demonstrate strong profit margins yet still be declined for financing due to inconsistent cash flow. This structural problem is highlighted by the Public Service Commission, which reported that as of the second quarter of the 2025/26 financial year, national and provincial departments had R12.4 billion in unpaid invoices older than 30 days. In the private sector, payment cycles can extend beyond 150 days, further complicating cash flow for SMEs.

Innovative Solutions Through Technology

Bridgement leverages live bank data and integrates directly with accounting software such as Xero, Sage, and QuickBooks. This allows the company to create a real-time financial profile of an SME in minutes, eliminating the need for lengthy administrative processes or audited financial statements. The integration provides verified, current data that reflects the operational realities of the business, offering a more accurate assessment than historical financial statements.

Another significant challenge is the impact of personal credit histories of directors and shareholders on business financing decisions. A director with poor personal credit can adversely affect a business’s ability to secure funding, even if the company is performing well. Bridgement’s data-driven assessment model evaluates the overall financial health of the business rather than focusing solely on individual credit histories.

Daniel Goldberg, founder and CEO of Bridgement, emphasized the importance of technology in simplifying access to funding. He stated that by utilizing financial data from accounting systems and bank accounts, Bridgement can construct a realistic picture of a business, ensuring that viable SMEs are not turned away due to imperfect paperwork.

Financial Impact and Future Prospects

Since its inception, Bridgement has deployed over R2 billion to South African SMEs, based on a clear understanding of their financial stability and specific funding needs. The company has established itself as a leader in the SME lending space, being the only lender in South Africa with integrations across multiple cloud accounting platforms.

Key insights into the funding landscape include:

• R12.4 billion in unpaid government invoices older than 30 days as of Q2 2025, marking a 17% increase quarter-on-quarter.
• A typical end-to-end cash cycle for SMEs supplying large corporations can exceed 150 days.
• Over R2 billion has been allocated to South African SMEs by Bridgement since 2016.
• Bridgement offers same-day turnaround from application to funding decision, with amounts up to R10 million available within 24 hours.

Goldberg reiterated the urgency of addressing cash flow issues for SMEs, stating that waiting three to six months for payment is incompatible with maintaining a healthy business. Bridgement’s mission is to act as a funding partner that aligns with the pace of SMEs, utilizing technology to streamline processes and reduce uncertainty.

By connecting directly with the accounting and banking tools that SMEs already use, Bridgement can gain real-time insights into their operations, allowing for timely and appropriate funding solutions. This approach enables clients to focus more on growth rather than cash flow management.

Source: www.zawya.com

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Published on 2026-06-16 15:08:00 • By the Editorial Desk