Johann Rupert’s R1-billion SME fund will start to give money to businesses from Tuesday, Business Partners MD Ben Bierman said.
Business Partners is administering the R1-billion fund, called the Sukuma Relief Programme, on behalf of the Rupert family and Remgro.
The fund was created to offer grants and loans to small and medium enterprises which are negatively impacted by COVID-19.
For formal sole proprietors, the fund offers a grant of R25,000 per qualifying business to be used to pay for overheads.
Closed corporations, companies, and trusts can apply for financial aid in the form of an unsecured interest-bearing loan of between R250,000 and R1 million.
These loans are also coupled with a non-repayable grant of R25,000 per qualifying business.
R2.4 billion in applications
On 3 April, Business Partners launched an application website for SMEs which are impacted by the coronavirus and subsequent lockdown.
The response was overwhelming. The fund received applications totalling R2.4 billion, far exceeding the fund’s R1 billion in capital.
The application process was closed on 6 April and Business Partners are currently processing all valid applications.
Applicants should hear back from Business Partners about their application over the next 5 to 7 working days.
Bierman told CNBC Africa that the first businesses will start to receive money from the Sukuma fund from Tuesday.
More money may be raised
The fact that applications exceeded the available capital by R1.4 billion means that a lot of businesses will not receive funding.
Bierman said the large number of applications show there is an urgent need from SMEs for assistance.
He hopes that other initiatives in South Africa will be able to cater to the needs of SMEs, in addition to the Sukuma programme.
Bierman said Business Partners will also see if they can raise additional capital for the Sukuma initiative.
“We will be making calls and requests to other benefactors to donate additional capital to the fund,” he said.
“We should have all of our documentation and processes ready over the Easter weekend, and maybe in the early part of next week we will be successful in raising additional capital.”
He said certain companies and individuals have expressed an interest, but he said additional funding is not confirmed as yet.
It would therefore be irresponsible to accept new applications before they receive clarity on additional capital from donors.