By Ziko,
South African fintech company, Float, has successfully raised $2.6 million in a funding round to fuel the expansion of its unique card-linked instalment platform. The investment, co-led by Invenfin and SAAD Investment Holdings, with participation from existing backers, will be used to scale operations across South Africa, enhance its technology, and prepare for international market entry.
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Float’s Innovative Platform
Float’s platform offers a “Buy Now, Pay Later” (BNPL) model that differs from traditional services. It doesn’t issue new credit to consumers. Instead, it allows shoppers to split large purchases into up to 24 interest-free and fee-free monthly instalments using the available credit limit on their existing Visa or Mastercard credit card. This approach promotes responsible credit usage by helping consumers manage their budgets without taking on new debt.
- How it works: When a customer chooses to pay with Float, the full purchase amount is reserved on their credit card, but only the first instalment is charged. The remaining balance is then paid off in monthly instalments, with the reserved amount on the credit card reducing with each payment.
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Impact and Future Plans
The platform has seen significant growth, with transaction volumes increasing by 400% year-on-year. It currently serves over 2,000 retail partners in South Africa, including major brands like iStore and Samsung. Merchants using Float have reported an average increase of over 130% in order values. The new funding will enable the company to:
Expand its footprint within South Africa, adding more retail partners.
Enhance its proprietary technology to improve the user experience.
Prepare for international expansion, with plans to enter other markets.
Float’s model is viewed by investors as a compelling and differentiated solution in the payments ecosystem, addressing a clear market gap while promoting responsible lending. The funding is a significant step towards solidifying its position as a leader in African fintech.
