Stanlib commits R250m to SME funder

Stanlib Asset Management has invested R250 million in Preference Capital Group (Prefcap), a financial services provider specialising in funding small and medium-sized enterprises (SMEs), it announced in a statement on Thursday.

The transaction brings Prefcap’s total capital raised in the past year to R700 million.

Listen: SME funding: The importance of a viable business plan

The funding aims to enhance access to finance for South African SMEs, which continue to face barriers in securing traditional bank loans, according to Stanlib.

The investment follows a detailed assessment of Prefcap’s lending model, risk management approach, and growth track record.

Prefcap provides non-bank financing solutions to SMEs — a sector that still struggles to gain access to capital.

Zeyn Ismail, fixed income portfolio manager for private markets at Stanlib, says the decision to invest in Prefcap reflects Stanlib’s confidence in the company’s business model and its role in the broader financial ecosystem.

“We acknowledge the essential role they play in overcoming the barriers SMEs face in securing traditional bank financing,” he adds.

Listen/read: SA companies sitting on a record amount of cash – and not using it

The investment forms part of Stanlib’s broader private markets strategy, which integrates public and private credit solutions. The asset manager notes that private debt can offer attractive risk-adjusted returns with low correlation to listed markets, making it an increasingly important component in investor portfolios.

Follow Moneyweb’s in-depth finance and business news on WhatsApp here.