SA escrow startup TradeSafe receives funding from Standard Bank

0

South African startup TradeSafe, an online escrow platform that safeguards the buyer’s funds in trust in a transaction involving two or more parties, has raised an undisclosed amount of funding from Standard Bank in return for a 35 per cent equity stake.

Disrupt Africa first reported on TradeSafe back in 2018. The startup’s escrow platform ensures funds are only released to the seller, and other approved beneficiaries, once the buyer receives the goods or services in the agreed condition.

Launched in 2013, TradeSafe claims to be the oldest African escrow platform, and also the first digital escrow organisation in the world to offer an API gateway which allows for online marketplaces and stores to offer escrow payments to customers.

The startup has now raised funding from Standard Bank, which has acquired a 35 per cent equity stake, with the investment set to allow TradeSafe to scale up in terms of the types of transactions it can carry out.

“Both TradeSafe and Standard Bank realised the necessity for a fast, secure, and affordable escrow solution in the wake of the increasing volume of scams, fraud and unpaid invoice payments in South African commerce. Our fees come in at a fifth of what a reputable law firm or bank would charge in a transaction,” said TradeSafe chief executive officer (CEO) Jethro O’Brien.

“The bank will provide a second release payment function. This means that with our increased governance, security and credibility, TradeSafe will now be able to target commodity and M&A transactions greater than ZAR25 million (US$1.5 million.”

As part of the investment, Standard Bank has appointed two non-executive directors to the TradeSafe board. Standard Bank, which has invested in other South African fintechs such as Payment24 and Nomanini, has also taken on management oversight of TradeSafe’s escrow account and is fully involved in the process for payment instructions that TradeSafe initiates.   

TradeSafe has recently overhauled its platform, and its API offering now also incorporates new payment gateways such as SnapScan and Ozow. 

“We also employed Standard Bank’s proprietary host-to-host technology which allows for automated payments,” said O’Brien.

Kuben Chetty, head of client solutions at Standard Bank, said there was a strong need for a digital escrow solution within South Africa given the rise of digital transactions and especially as buyers and sellers seek ways to mitigate transaction fraud. 

“Standard Bank is very excited with its investment in TradeSafe Escrow and this provides both parties the opportunity to explore ways to leverage each other’s capabilities to help their clients transact securely,” Chetty said.

Share.

Passionate about the vibrant tech startups scene in Africa, Tom can usually be found sniffing out the continent's most exciting new companies and entrepreneurs, funding rounds and any other developments within the growing ecosystem.

Comments are closed.

Exit mobile version