South African fintech company Yoco has secured a $100 million credit facility from US-based investment firm Victory Park Capital Advisors as it prepares to expand financing opportunities for small businesses across the country. The deal marks a significant step in Yoco’s evolution from a digital payments provider into a broader financial services platform for merchants.
Announced on November 9, 2026, the financing will support Yoco’s merchant lending operations, allowing eligible businesses using its payment platform to access working capital for daily operations, inventory purchases, equipment upgrades and business expansion.
Founded in 2015 and headquartered in Cape Town, Yoco provides card payment terminals, online payment processing and business management solutions to small and medium-sized businesses.
Over the years, the company has built a substantial merchant network by helping businesses accept digital payments and manage transactions more efficiently. It now serves approximately 200,000 merchants and has processed more than $15 billion in payments.
The new $100 million facility from Victory Park Capital represents Yoco’s first direct entry into the debt market. Unlike equity financing, which involves selling ownership stakes to investors, the credit facility provides borrowed capital that the company can use to expand its lending activities without immediately diluting existing shareholders.
According to reporting by Bloomberg, Yoco has previously facilitated approximately R6.5 billion in merchant financing through external partners. The new arrangement will give the company greater control over financing its merchant network directly.
The funding will support cash advances ranging from R2,000 to R1.5 million, depending on the needs and eligibility of individual businesses.
Merchants can use the financing to purchase additional stock, employ more workers, upgrade equipment or establish new business locations. These are essential investments for small businesses seeking to increase revenue but often struggle to obtain affordable funding from traditional financial institutions.
Yoco’s lending approach is particularly interesting because it uses transaction data generated through its payment platform to assess merchants’ business activities.
Eligible businesses can receive pre-approved financing offers based on their sales performance. Once approved, funds are transferred directly to their accounts, while repayments are automatically deducted from daily sales.
This approach connects financing to actual business activity rather than relying exclusively on conventional credit assessments.
For businesses with inconsistent revenue or limited access to traditional banking services, this model could provide a more flexible route to working capital.
Yoco’s expansion comes as small businesses in South Africa continue to face significant difficulties accessing finance.
According to the Access to Finance report produced by financial services aggregator Finfind, the country’s small-business financing gap is estimated at approximately R350 billion.
Many businesses struggle to secure bank loans because of limited collateral, insufficient credit histories and strict lending requirements. These challenges can prevent otherwise viable businesses from purchasing inventory, expanding operations or responding to growing customer demand.
Fintech platforms are increasingly attempting to address this problem by using digital payment records and alternative financial data to evaluate businesses.
Yoco’s latest financing arrangement demonstrates how payment technology can become an entry point for broader financial services, particularly for businesses underserved by traditional lenders.
Victory Park Capital manages approximately $3.6 billion in assets and has invested more than $12 billion across 260 investments since 2007.
Its partnership with Yoco also highlights the growing importance of private credit in financing established technology companies. Rather than depending entirely on repeated equity fundraising, fintech businesses can use debt facilities to support specific revenue-generating activities such as merchant lending.
For Yoco, the immediate opportunity is to strengthen relationships with existing customers while developing another source of business revenue.
However, expanding lending also introduces risks. The company must carefully manage repayment performance, merchant cash flows and the possibility of business failures, particularly in an environment where operating costs remain a challenge.
Yoco’s $100 million credit facility is more than a funding announcement. It represents a strategic expansion into merchant financing and reflects the growing role of fintech companies in addressing small-business funding challenges.
As African businesses increasingly adopt digital payment solutions, companies that combine payments, financial data and accessible credit could become important partners in SME development.
For Yoco, the next challenge will be turning this financing capacity into sustainable lending growth while ensuring that merchants receive capital they can realistically repay.
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