You need cash for your business, and you need it yesterday. The bank said no or is taking too long. So, you dive into the world of alternative lending and are bombarded with promises of “fast,” “simple,” and “instant” cash. But here’s the hard truth: not all fast money is good money.

Many modern lenders hide behind slick apps and confusing terms, making it nearly impossible to figure out what you’re really paying. This guide cuts through the noise. We compare the common funding models you’ll encounter so you can choose a true partner, not a predator in fintech clothing.

The True Cost: Unpacking the “Gotcha” Clause

The headline rate is what they sell you, but the total cost is what sinks you. Let’s break down the three dominant models for SME funding.

• Model 1: The “Slick App” Lender (Fixed-Fee) This model, popular with purely digital lenders, charges a single “fixed fee” on your advance. For example, you borrow R100,000 and have to pay back R115,000 over 6 months. It sounds simple, but the devil is in the details. Because it’s a fixed fee, you pay the full R15,000 in costs whether you pay it back in 6 months or 2 months. If you pay it back faster, the effective interest rate skyrockets. They count on you not doing the maths.
• Model 2: The “Percentage-Based” Lender (Merchant Cash Advance) This model advances you cash in return for a percentage of your future card sales. Every time a customer swipes their card, the lender takes their cut directly. While it seems linked to your performance, this method can be suffocating. During a high-turnover month, a massive chunk of your revenue vanishes, crippling your ability to reinvest. The costs are often unpredictable and can spiral into some of the highest effective rates in the market.
• Model 3: The Bizcash Partnership Model (Transparent Interest) We reject the models above. We operate on a simple, transparent interest model. You only pay interest on the outstanding balance, just like any fair loan. This means if you pay your facility back faster, you pay less in total costs. There is no penalty for success and no confusing maths. We show you the total cost upfront, in Rands and cents.

The Human Factor: Are You a Client or an Algorithm?

When your business hits a snag at 8 PM on a Friday, who do you call?

With most app-based lenders, you’re on your own. You’ll submit a ticket to a faceless support desk or navigate a chatbot. They treat you like a data point. Their algorithm approved you, and their algorithm will manage you.

We built our business on the opposite principle. Our technology makes us fast, but our people make us valuable. Every Bizcash client has access to a dedicated franchisee—a real person in your community who understands your business. They meet with you, they answer their phone, and they act as your advocate. We see a partner, not a profile.

The Trust Signal: Who Backs Your Funder?

The alternative lending space is crowded with startups backed by venture capital. Their primary goal is often rapid growth, not necessarily the long-term sustainability of their clients. What happens if their funding dries up or their growth-at-all-costs model implodes?

Bizcash stands on a foundation of rock-solid trust. With significant backing from Old Mutual, we offer the best of both worlds: the speed and agility of a fintech, combined with the stability and integrity of one of South Africa’s most established financial institutions. We aren’t a flash in the pan; we are building lifelong partnerships.

The Choice is Yours

Choosing a funder is one of the most critical decisions you’ll make. Don’t be seduced by speed alone. Look deeper. Scrutinise the costs, demand human support, and check who is standing behind the brand.

If you suspect you’re paying too much or getting too little support from your current funder, talk to us. Get a no-obligation comparative quote and see what a real partnership feels like.

Connect with Bizcash to fund your next business funding requirement today.

• • Email: info@bizcash.co.za
  • Call: 0861 939393
  • Website: www.bizcash.co.za

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