The Gauteng government, the Industrial Development Corporation (IDC) and the SA SME Fund have launched a R300 million debt fund to help small businesses in the province’s townships.
The entities contributed R100m each towards the loan-based fund, which will be managed by the SA SME Fund on a pro bono basis. The trio says the Gauteng provincial government’s share will assume the first portion of any losses.
The SMME Crisis Partnership Fund aims to help township businesses that do not qualify for funding from the formal banking sector get access to much needed capital.
The fund was officially launched in Tembisa, on the East Rand on Wednesday.
Speaking at the launch of the fund at Kraalfontein Corner shopping centre in Tembisa, Parks Tau (Gauteng MEC for economic development, agriculture, environment and rural development) said the fund intends to enable township-based businesses to access funding that is essential to business growth and job creation.
He said the funding will help with the integration of the informal SMEs into the formal economy.
“Today’s launch of the SMME Crisis Partnership Fund is part of our deliberate approach to reignite the township economy and elevate it to respond to the current needs of society.
“For many years township property owners have struggled to get flexible and risk-free funding to build backyard rental flats. We are working in partnership with Indlu Living to provide that assistance to property owners.”
The Gauteng Enterprise Propeller will be working hand in hand with SA SME and the IDC in ensuring the fund’s success.
Source: Sowetan Live, Business Day, Moneyweb, Engineering News, image from Twitter: @TauParks