Where to Access Funding For Women-Owned Businesses in South Africa

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Female entrepreneurs have limited access to finance in comparison to their male counterparts, the unmet yearly financial needs for women-owned businesses worldwide is estimated to be between $260bn and $320bn.

This highlights the need for new lending models and more women-focused lending institutions. There are, however government and private enterprises with programmes and funds in place aimed at providing access to funding for women-owned business in South Africa

Here is a list of funds and financial assistance programmes that provide funding for women entrepreneurs in South Africa.

1. Enablis Acceleration Fund

The Enablis Acceleration Fund is a partnership between Enablis Financial Corporation SA (Pty) Ltd and Khula Enterprise Finance Limited.

The main objective of the fund is to improve access to SME early stage funding, while reaching out and supporting SMEs that are developing in remote or rural areas with a view to creating new sustainable jobs that alleviate poverty and reduce unemployment. This acceleration fund offers equity and debt instruments over loan periods no longer than 60 months.

To qualify for the fund you must meet the following requirements: be a South African SME that is accredited by the Enablis Entrepreneurial Network; are black and women entrepreneurs for startups and for the expansion of a business; SMEs involved in all sectors, specifically ICT, transport, tourism, agriculture and services industry and SMEs that need working capital and/ or asset finance.

To become a member visit the Join Enablis section at http://www.enablis.org/ and fill out the application form.

2. Business Partners Women in Business Fund

Aimed at increasing access to finance for female entrepreneurs, the Business Partners Women in Business Fund seeks to afford South African women a fair and equal opportunity to start, expand or purchase an existing business.

The Fund will offer finance between the value of R500 000 and R50 million per investment over a five year financing period. All female owned businesses (at least 50%) that are commercially viable with female owners active in the business will be considered for financing.

Female entrepreneurs financed through the Women in Business Fund will be supported with additional value added services such as dedicated industry specific mentors and a technical assistance (mentorship) grant of up to R25 000 to aid in the development of the business. A further R35 000 interest free loan for technical assistance, should it be required, will also be available. They will also have access to information, via a dedicated LinkedIn page Women in Business Africa, and networking opportunities, such as workshops and the annual Women’s Month seminar.

3. National Empowerment Fund (NEF)

The National Empowerment Fund (NEF) is established by the National Empowerment Fund Act, 1998 (Act No. 105 of 1998). The NEF is a driver in promoting and facilitating black economic participation by providing financial and non-financial support to black empowered businesses, and promoting a culture of savings and investment among black people.

The NEF Women Empowerment Fund is aimed at accelerating the provision of funding to businesses owned by black women.

The NEF provides business loans from R250 000 to R75-million across all industry sectors, for startups, expansion and equity acquisition purposes.

Read more: A Guide to Government Funding for SMEs

4. Isivande Women’s Fund (IWF)

In 2008, government partnered with Old Mutual’s Masisizane Fund to set up the R100 million Isivande Women’s Fund which invests directly in women enterprises by offering loans at lower interest rates, as well as offering non-financial support.

The fund is an intervention to reduce poverty to this category of entrepreneurs who are often constrained by limited access to finance.

Isivande Women’s Fund (IWF) is an exclusive fund that targets black women at the bottom of the economic ladder. Its aim is to accelerate women’s economic empowerment by providing affordable, usable and responsive finance than was available.

The fund is managed by the Industrial Development Corporation (IDC) on behalf of the Department of Trade and Industry through Identity Development Fund (IDF) managers.

Read more: Funding For Rural Women In Agriculture

5. IDF Managers Funding Alitheia Identity Fund (AIF)

In an effort to address the lack of access to funding faced by many African women entrepreneurs, Tokunboh Ishmael, Polo Leteka and Anne-Marie Chidzero joined forces to launch the Alitheia Identity Fund (AIF), a pan-African SME fund that invests in innovative, growth stage SMEs that are women-led or gender balanced in the Sub-Saharan Africa region.

The joint venture sees two established women-owned fund management companies come together – Nigerian based Alitheia Capital Limited which focuses on SMEs in the finance, energy and housing sectors and co-founded by Ishmael (CIO); and Identity Development Fund Managers (IDF), a South African based equity firm co-founded by Leteka (principal partner and COO).

Read more: For Women By Women – What You Need to Know About the Alitheia Identity Fund

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