The Eastern Cape Development Corporation (ECDC) has disbursed R106 million in loans and financial incentives to 529 small businesses during the 2022/23 financial year.
This was revealed by ECDC chief executive Ayanda Wakaba during the development financier’s annual results announcement last week, November 20.
Wakaba said the disbursed amount was comprised of R48 million in loans, R24 million from the Eastern Cape Jobs stimulus Fund, R18.7 million from the Imvaba Co-operatives Fund, R4 million from the Small Towns, Rural and Township Enterprise Support Programme (STRTEP) and R11.3 million from the Informal Business Support Programme (IBSP).
“The 2022/23 financial year laid the basis for the ECDC to deepen and amplify its role as a high-performing development finance institution. The ECDC’s efforts were not only directed at the enhancement of its development finance mandate, but also toward the general financial health of the corporation.”
“The corporation is pleased with the eighth successive unqualified audit opinion it received in 2022/23. The ECDC balance sheet remains strong, with total company assets exceeding total liabilities by R1.3 billion,” Wakaba said.
The ECDC’s financial and non-financial support to deserving entrepreneurs is crucial to the development of thriving and sustainable regional economies.
Loan repayments were R43 million, while an average collection rate of 95 percent was achieved for short-term loans.
The value of loans disbursed was high due to high value loans disbursed in 2022/23, compared to those of the previous year.
The R48 million in loan disbursements went to 49 small businesses. A total of R17 million went to women-owned businesses, while R2.2 million went to businesses owned by youth.
Enterprises in the OR Tambo district received R21.9 million of the disbursements, R13.5 million to those in the Alfred Nzo district, R8.3 million to those in the Amathole district, R3.6 million to businesses in Nelson Mandela Bay, R325 216 in the Sarah Baartman district and R80 225 in Joe Gqabi.
The R24 million disbursed through the Jobs Stimulus Fund went to 55 businesses. Of this amount, R11 million was used to save 1 116 jobs.
The Jobs Fund is intended to retain, save and protect jobs at risk in distressed businesses. A further R13 million was disbursed for working capital which helped the affected businesses to stay in business while saving jobs. The fund also referred approved businesses for non-financial support, which helped identify the reasons for distress and to implement corrective measures.
Wakaba said in 2022/23, that R16.7 million was approved for disbursement to 32 co-operatives. However, a total of R18.7 million was disbursed to 57 co-operatives, which included commitments remaining from the previous year.
Furthermore, the ECDC also disbursed R11.3 million to 330 businesses in the form of equipment, machinery and tools through the Informal Business Support Programme. The programme provides support to informal businesses post the COVID-19 pandemic.
In addition, R4 million was disbursed to 38 businesses through the Small Towns, Rural and Township Enterprise Support Programme. The programme provides integrated support to formal and informal small businesses operating in rural, small town, and township localities.
The ECDC supported 242 businesses with direct business development services, while 1 442 people received additional business development services through training activities and business seminars.
