Yoco, the Cape Town fintech whose card machines and software run more than 200,000 small South African businesses, has secured a $100 million credit facility, about R1.65 billion, from US private credit firm Victory Park Capital. The money will fund Yoco Capital, which offers merchants cash advances against their future sales, and gives Yoco direct control of that lending at scale for the first time, instead of relying only on partners.

"We've spent a decade building an operating system that runs a merchant's whole business, payments, point of sale, and now the decisions in between. Financing was the one layer we didn't fully control. This facility changes that," said chief executive Carsten Holtkemeyer.

Yoco says it is one of the largest dedicated merchant cash advance raises in Africa. Since 2018, working with specialist small business lenders, Yoco has advanced more than R6.5 billion to over 40,000 merchants, and says it has not recorded a single unprofitable group of loans in that time, including through Covid-19.

The product works differently from a bank loan. There is no application form. Because a merchant already takes payments through Yoco, its sales data shows how the business is performing, and a pre-approved offer appears in the Yoco app. Advances range from R2,000 to R1.5 million, need no collateral and land in the merchant's account with one click.

Repayment is taken automatically as a small cut of each day's card takings, so it falls when sales are slow, instead of a fixed monthly instalment. Merchants typically use the money to hire staff, stock up before a busy season, buy equipment or open a new branch.

"The offer simply appeared in my Yoco app. I never had to apply or go looking for funding," said Aubrey Williams, owner of Karoo Creations.

The gap it targets is large. The 2025 Finfind and African Bank SA MSME Access to Finance Report puts South Africa's small business financing gap at roughly R350 billion, and small businesses receive just 13% of bank lending, against 51% for large companies. Victory Park, majority-owned by asset manager Janus Henderson, has invested over $ 12 billion across about 260 deals since 2007. Yoco says it will keep using partners where that suits a product or market.

Bloomberg first reported the deal, describing Yoco as backed by global investment firm TPG. "Yoco has a proven track record of supporting the operating needs of small and independent businesses," said Jason Brown, senior partner at Victory Park. The facility follows Yoco's move this year from payments into a full operating system for small businesses, which we covered when it bought Dyner AI and launched its new SME platform at Yoco Next, cutting merchant fees by R250 million a year.

The interesting part is not the size of the facility but what makes it possible. A bank deciding whether to lend to a small coffee shop sees a few months of statements, at best. Yoco sees every tap and sale, every day, which tells it far more about whether the shop can repay. That is why it can approve advances in the background and collect them as a share of daily takings.

It is the same idea behind Omnisient using grocery data for credit: whoever holds the best real-time data can lend where banks cannot. Owning the loans also changes Yoco's business. Instead of passing the lending profit to partners, it now keeps the margin and the risk, which makes accurate pricing and careful collections more important than ever.

For merchants, the flexibility of repaying from daily sales is real, but an advance still has a cost, so it is worth comparing the total amount repaid with other options before clicking accept. And for South Africa's R350 billion small business funding gap, lenders built on payment data may be one of the more practical ways to close it.

You might also like our piece on Yoco Loyalty, Kuunda's lending infrastructure, and Mukuru's spaza shop pay-ins.

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