UK FinTech Stenn Offers SMBs Digital Invoice Financing

U.K.-based FinTech Stenn, which specializes in invoice financing, is focusing its energies on to small and medium-sized businesses (SMBs) and emerging markets, where access to trade financing has often been limited.

Trade finance is especially critical for export businesses, which often wait months for payment due to the slow nature of international trade.

“We realized a lot of goods are being bought from emerging markets, such as China, India and Latin America, so we started meeting with suppliers in these countries and we saw how dramatically they were underbanked,” Co-founder and CEO Greg Karpovsky said in an interview with the Financial Times.

Stenn has the ability to finance trades worth up to $10 million, a higher range than that offered by other FinTechs in the invoice financing space and putting it in the same league as banks, per FT.

As well as increasing access in emerging markets, Stenn is also looking to beat existing invoice financing solutions in terms of approval speed. The startup promises to approve online loan applications in just 48 hours. Stenn uses a data-centric approach to assess credit, fraud and compliance risks, and Karpovsky told stressed the firm is a technology company with computer engineers making up over half of its employees.

According to the company’s website, to date, Stenn has issued over $10 billion (USD) in financing to SMBs in 74 countries since its launch in 2016. Capital is provided by a range of banks and institutional fund managers, including HSBC and Barclays.

David Brear, CEO of FinTech consultancy 11:FS, told FT that in the current economic climate, growing SMBs are going to be “queuing up” for invoice financing services given the pressure on their cash flow.

Calling the pressures facing SMBs “scary,” Brear said, “I can only see Stenn clearing up in that space. So, if it’s got a big enough book from a lending perspective, this is pretty low-risk when it comes to invoice financing. It’s a bit of a blue ocean for them given the lack of competition at this scale.”

Another startup that has turned its attention to the SMB trade finance gap in emerging markets is the Nigerian company Breeze, which recently partnered with U.K.-based supply chain finance company Finverity to accelerate its growth.

Read also: Supply Chain FinTech Breeze Teams With Finverity on African SMB Capital

For all PYMNTS EMEA coverage, subscribe to the daily EMEA Newsletter.