The City of Ekurhuleni (CoE) has launched its Community Enterprise Development Fund (ECED) as part of its multi pronged strategy to boost the local economy and create jobs.
The ECED will support the development of community enterprises in the form of individual entrepreneurs, Small, Micro & Medium Enterprises, Cooperatives, Informal traders and formal businesses.
“The ECED Fund was created in line with the City’s pro-poor approach to governance. We want to provide access to funding for informal traders, cooperatives, micro-entrepreneurs, and young startup founders. Access to financing for young black entrepreneurs, and females in the main remains a serious challenge. If we are to correct the economic injustices of our past, we must unashamedly support small black businesses.” said Mayor Mzwandile Masina.
The Fund is part of the the Ekurhuleni Ten Point Economic Plan to position the Gauteng Eastern Development Corridor as the anchor and footprint of the provincial economy.
The City said it has adopted a bottom-up approach which will deliberately focus on funding small businesses.
The ECED Fund has been grouped into three funding options:
Mbewu Fund: Mbewu, a xiTsonga word for seed, will focus on Business Seed Funding for local entrepreneurs, businesses, and organisations through grants issued by the City (Funding Threshold: R50,000 to R1,5 million)
Fetola Fund: Fetola, a Southern Sotho word for Transformation will look at transformative projects, equity financing and the promotion of commercial participation and expansion. The fund will be syndicated by the National Empowerment Fund in collaboration with the City (Funding Threshold: R100,000 to R8 million)
Phanda Fund: Phanda, a isiZulu slang word for hustling will provide business support, enablement funding, seed funding, and advisory services. The fund will be syndicated through the National Youth Development Agency, Small Enterprise Development Agency, the Gauteng Enterprise Propeller, and the City (Funding Threshold: R100,000 to R3 million)
With the small and medium sized enterprise sector currently responsible for 60% of jobs in the country, the CoE has prioritised this sector as a job creation catalyst which it said must be leveraged immediately.
The ECED Fund will offer services through non-financial & financial interventions such as business support, technical support, co-funding, export promotion, incubation, pitching competitions and business infrastructure support amongst others.
The CoE says a top priority is to develop a more “inclusive and responsive job creation strategy” or the City.
“The city must create an entrepreneurial ecosystem that promotes the development of high-impact startups, which will have an employment growth quantifier of two or more if we want to reverse our current unemployment crisis.”
The ECED Fund is exclusively reserved for Ekurhuleni based entrepreneurs, with the application window scheduled for opening on 11 November 2019 and close on 31 January 2020.