As part of its ongoing bid to support local SMEs, FNB has announced that it recently distributed R17 million in grant funding to black-owned businesses.
The grants were awarded to early stage social enterprises focusing on education and small-scale farming. The goal of the funding is to catalyse the development of new ideas and facilitate wealth creation. As relates to farming, FNB hopes these grants will improve access to land and asset ownership.
“We understand that simple grant making is neither scalable, nor sustainable in the long term, but we believe it could have a place in the broader funding continuum. Supporting promising businesses at an early stage catalyses their development, allowing them to reach the point at which they can access more traditional financing mechanisms faster,” explains head of SME development at FNB Business, Heather Lowe.
The financial institution says it took great care in selecting the businesses it would award grants to. FNB assessed the strength and sustainability of the business models, its ability to generate scalable social impact and whether the business could grow its reach with the help of the grant.
FNB will evaluate how the grants were utilised by monitoring the various organisations. Education-based SMEs will be monitored for two years while
“If we don’t grow entrepreneurs in our country, then as a financial institution we won’t have sustainable businesses to fund. A key focus of our strategy centres around providing meaningful support to SMEs as productive drivers of inclusive economic growth and development in South Africa. The intention is to learn from this pilot project in a way that will allow us to go to market and raise a much more scalable pool of funding in the future,” concludes Lowe.