The Ekurhuleni metro and the National Empowerment Fund (NEF) launched the much-anticipated Fetola Enterprise Development Fund on December 6 at the KwaThema Business Hub.
The event was attended by the minister of Small Business Development, Khumbudzo Ntshavheni, as well as 500 local entrepreneurs who are among the intended beneficiaries of the R300-million committed by the two institutions over the next years.
Ntshavheni said: “Economic transformation is imperative and SMMEs are key drivers and contributors to job creation and economic progression.
“We need to create an enabling environment for their growth and sustainability, through the right policies and targeted support mechanisms to ensure their participation.
“Availing information on funding, reducing the cost of funding and bringing business support services closer to communities are some of the measures to unlock funding bottlenecks,” she said.
‘Fetola’ is the SeTswana word for transformation “and what we are seeking is to achieve inclusive growth so that black entrepreneurs in the townships, in the cities and in rural communities can also become integral to the country’s economy,” explained NEF CEO Philisiwe Mthethwa.
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The Fetola Fund is one among four investment funds approved in October 2019 by the Ekurhuleni Council to implement the Ekurhuleni Community Enterprise Development Fund Policy in line with the Municipal Finance Management Act (MFMA).
“The purpose of the Ekurhuleni Community Enterprise Development Fund (ECEDF) is to support the development of community enterprises in the form of individual entrepreneurs, small, micro and medium enterprises, cooperatives, informal traders and formal businesses as prescribed.
The ECED fund is anchored by the Ekurhuleni Ten Point Economic Plan, a deliberate programme to position the Gauteng Eastern Development Corridor as the anchor and footprint of the provincial economy.
The metro has prioritised the Small Medium Enterprises (SMEs) sector as a job creation catalyst that must be fully supported,” said executive mayor Mzwandile Masina.
“This fund is made up of three groups,” he says. They are as follows:
• The Phanda Fund aims to support the development of community enterprises in the form of individual entrepreneurs, small, micro and medium enterprises, cooperatives, and informal traders located within the metro.
This focuses on the township economy, industrialisation, business services, environmental services and human development. The thresholds for this fund are from R50 000 to R1.5-m.
• The Ximilani Fund is designed to syndicate with registered organisations, organised business formations, associations and/or chambers of commerce located within the metro.
The funding thresholds for this fund range from R50 000 to R1.5-m.
• The Fetola A Fund seeks to partner on a 50-50 cost and risk sharing basis with development finance institutions, state-owned enterprises, corporate social investment partners, enterprise and supplier development, and private funds. Ideal partners are those organisations that exist for the sole purpose of developing black businesses.
The funding range for this is from R100 000 to R6-m.
• The Fetola B Fund is a soft loan that is exclusively reserved for Ekurhuleni-based entrepreneurs.
The minimum application is R250 000.
This fund is aimed at black-owned businesses, individual entrepreneurs, small, micro and medium enterprises as well as potential industrialists and will be administered by the NEF.
