Verdant Capital raises ZAR 300 million for leading South African minibus taxi finance provider, Bridge Taxi Finance
Verdant Capital has successfully raised ZAR 300 million (approx. USD 20 million) in debt financing for Bridge Taxi Finance from a small group of leading international impact investors. The funding will be used to grow the institution’s lease portfolio.
Bridge Taxi Finance, based in South Africa, provides affordable credit facilities to South African drivers – each an entrepreneur running his own taxi business – in the minibus taxi industry. It has a vertically integrated business model that includes impact vehicle finance, day to day tracking, advice and management, and vehicle repairs and services. The company has financed over 3,200 entrepreneurs to date (1,100 in FY2021 alone).
South Africa’s taxi industry plays a vital role in the country’s economy, accounting for over 70% of all public transport trips, and is the most widely used form of public transport in Africa. Over 15 million South Africans make use of minibus taxis to get to and from work every day. Bridge Taxi finances financially excluded individuals and provides them with an opportunity to own income-generating assets, enabling them to contribute positively to the economy. With an estimated 250,000-280,000 minibus taxis operating in the country’s formal routes, there is a significant monthly supply gap of minibus taxis in excess 1,000 vehicles. Bridge Taxi plans to address this gap by importing new, safer vehicles. These new vehicles imported, with higher Euro emissions standards, will replace the old fleet which has higher carbon emissions. Bridge Taxi also plans to offer electric vehicles in the coming years, and feasibility studies have already commenced. Bridge Taxi is majority owned by the founders, with a minority held by domestic private equity.
The transaction is the first introduction for Bridge Taxi Finance into the international markets marking a landmark transaction for the inclusive finance sector in South Africa. Verdant Capital has acted as sole arranger and advisor for Bridge Taxi Finance. Verdant Capital is expecting a significant additional close in the next six months.