THE Industrial Development Corporation (IDC), hosted stakeholders and entrepreneurs to a roadshow in Durban on 14 February.
One of the IDC’s key objectives is to support entrepreneurs who want to invest in industrial capacity development and job creation within the Small and Medium Enterprises (SME) sector.
Manoj Seonath, head of small business finance and regions, explained the IDC’s mandate and options for entrepreneurs and answered questions as he said the roadshow was also an opportunity for the IDC to hear how it can improve.
At a regional level, the Corporation has enhanced its offering and transfigured regional operations to the small business finance and regions (SBF) business unit, which is geared up to streamline offerings.
The change has turned regional offices into turnkey operations which cover transactions up to R20 million, reducing touchpoints and speeding up the turnaround time on deals.
SBF mandate
The SBF has a focus on stimulating local and regional economic activity through targeted funding and investments towards SMEs. By supporting the development of an active SME environment, the unit contributes towards job creation, promotion of youth and women entrepreneurs and operations, and strengthening of SME capacities to improve their competitiveness in the domestic, regional and global markets.
The unit specifically caters for businesses looking to access funding from R1 million to R20 million in the mandated sectors that the IDC funds.
SME-Connect programme
The IDC’s SME-Connect programme follows a strategic collaboration model to expand and deepen industrial development in the small industrial business segment through leveraging skills, balance sheets, resources, networks and influence of partner entities to develop and grow SMEs.
The IDC has approved R954 million to 58 SMEs through the SME-Connect programme.
According to Pat Moodley, KZN regional manager, the IDC’s KZN regional office is one of the biggest contributors to the Corporation’s approvals.
The office contributed just over R2,8 billion in approvals within the province in the IDC’s last audited results.
Moodley says one of the key strategies of the KZN office is identifying existing and new potential industries earmarked for rapid growth in KZN markets. He said the textiles, clothing and footwear industry are underscored as key drivers of the KZN economy, given the ease of access to the Durban port for exports.
Other economic sectors regionally supported include agro-processing, chemicals, pesticides, medical products, wood and furniture products; automotive and transportation; machinery and equipment; forestry; infrastructure and energy.
Seonath said the IDC does not receive funding from the National Treasury and, therefore, has to ensure that the funds it lends out can be paid back to sustain the Corporation.
The IDC does, however, partner with other government organisations and grant funding agencies, which means it often does have ways to access lower-interest finance or grant funding to assist small businesses. These funds are focussed on sectors like manufacturing and agriculture.
Seonath said to give new business owners a kickstart, the IDC does not require security when providing financing but rather considers the candidate’s viability. This gives entrepreneurs without capital a chance to get off the ground or grow.
Funding can also only be approved for applicants that are compliant and meet the IDC’s requirements such as financial records, tax compliance and industry-specific requirements. The IDC offers support to applicants needing assistance in the pre-application phase.
