Yoco announced today that its customer base of small businesses had crossed the 50,000 milestone and to further grow its customer base the South African FinTech firm is launching a new, lower-cost POS terminal
The South African Point of Sale payments provider also launched the Yoco Go, a card machine targeting previously underserved small businesses that have not had access to card payment and Point of Sale technologies.
The introduction of the Yoco Go is a critical element of the company’s growth strategy of doubling its merchant base over the next twelve months.
Historically, small businesses have been excluded from the full payments ecosystem by red tape, long-term contracts, prohibitively expensive hardware and opaque fees.
Yoco’s research has shown that having card payment facilities can increase a small business’s sales by up to 40% – presenting a vital growth mechanism in today’s challenging economic climate.
SMEs are big business in South Africa, contributing close to 50% to GDP and driving most of the employment. However, due to their small size, fragmented nature, and general unpredictability, they remain overlooked by large financial institutions because it hasn’t been economically viable to reach them from a cost and risk standpoint.
SME financial services participation is limited typically to the use of a cheque or savings account by the business owners. Nowhere is this dynamic more visible than in card acceptance at the point of sale, where more than 7 out of 10 adults in the country have a card, but less than 10% of businesses can accept cards.
The Yoco Go card machine enables business owners to start accepting payments for a once-off purchase price of R799 – with free nationwide delivery and simple, free setup. There are no monthly contracts or fixed fees.
Yoco also hopes that the card machine will catalyse entrepreneurship and encourage people to “just start” – a movement which, Yoco believes, will ignite growth in the South African economy.
“We are now in a position to provide an even broader base of small business owners with access to payment technologies never before affordable to them,” said Katlego Maphai, co-founder and CEO of Yoco.
Yoco was founded late 2015, with 500 merchants on the platform, and raised $16m in September 2018.
At the end of 2016, the company announced it had acquired over 5 000 SME merchants, growing 10x in a year.
“A year ago, Yoco had a customer base of 27,000 merchants. After announcing our Series B funding, our mission intensified to improve access to underserved small businesses by growing our customer base nationwide and investing heavily in product development and scalability,” said Maphai.
“In a market estimated to be more than one million small businesses, we are delighted to announce that Yoco’s customer base reached 50,000 merchants last week. Alongside this, we are processing R6bn in card transaction volume annualised.
“We are also excited to launch the Yoco Go card machine, which will radically lower barriers to entry for small businesses,” he continued.
“The device will bring tap payments to all, allowing merchants to accept card payments with a fully-featured, safe, fast, and tap-enabled card machine for less than half the price of alternatives.”