It’s been five years since local microfinancier Sprint Financial first started offering its ‘Receivables Financing’ service, an initiative meant to change the mold of traditional microlending in Jamaica and funding the underbanked.

As of this year, Sprint suggests it has recorded an 80 per cent uptake in Receivables Financing applications and that its customers have reported a quarterly revenue increase from 10-15 per cent from using the service.

Receivables Financing is where an entity pays a business for their outstanding invoices, eliminating the need for businesses to wait for their customers to pay them before having access to funds. More recently, Receivables Financing has been gaining popularity as a loan product, with more MFIs beginning to offer this service increasing its accessibility to SMEs. Some major banks (like NCB) in recent times have now put their bid in, to tap into the SME financing goldmine by now offering receivables financing and other loan products particularly geared towards targeting SMEs.

At its inception, the service was not commonplace in the local financial industry, with only a handful of major financiers (like EXIM Bank) counting the product among its service offering. It certainly wasn’t commonplace in microlending, as it seemed few financing options such as this were ever really catered to small or medium enterprises (SMEs).

Offering his thoughts on the increased offering of the service, Sprint’s CEO Christopher Barrett shared: “It’s a really great thing to see more companies come forward and offer this service, if anything it benefits the industry and Jamaica as a whole. I mean, when we first started it took a lot of convincing and explaining with regard to how the product works and benefits a business, because it wasn’t readily known. This brings more awareness, in fact, I expect to see lending in Jamaica evolve even more because of the baby steps like these. I’m happy to say we are a part of paving the way and inspiring some direction.”

COME A LONG WAY

The microfinancier is no stranger to setting trends within the local industry. It can be credited as the first to offer “party loans” and “aesthetic loans” (for cosmetic surgical procedures) which at the time of inception, raised eyebrows.

“In 2023, we can proudly say we have come a long way from our earlier branding and have since cultivated a new business model as a business solutions-oriented microfinancier offering niche financing options to SMEs – leaning further into a fintech model as we transitioned to being 100 per cent virtual since 2019,” shared Barrett.

The company has altogether abandoned its trademark leisure loans and is now eyeing corporate ambitions, with a concentration on using emerging technologies as a means of enhancing the loan process and experience for Jamaica’s entrepreneurs.

Additionally, Sprint has seen an increase in Purchase Order Financing, another of Sprint’s niche financing options, which as the name suggests, is geared toward businesses that need to purchase inventory or materials to fulfill orders, but don’t have the cash on hand to do so. The product allows businesses to pay suppliers for the goods they need, which allows businesses to grow and expand more quickly, as they are able to take on more orders and increase production without being constrained by a lack of funds.

Barrett added: “With the rise in popularity of these financial products, Sprint anticipates an additional increase in competition from other financial institutions. However, the company is firm on maintaining an edge by offering an easy application process, flexible rates, and faster disbursal times.”