The Western Cape Government’s new finance model has assisted small businesses to sign deals for work worth R12 million, creating more than 300 jobs.
In the past eight months, the cession of payment model, which is being piloted by Western Cape Department of Economic Development and Tourism, has supported 14 companies in accessing funds from financial institutions.
Alan Winde, MEC of Economic Opportunities, explained that through this model, small companies who cannot afford to purchase upfront the goods or services they need to obtain a government tender can approach a third party such as a financial institution or supplier to provide the money or goods they need.
The signed Western Cape Government tender provides the surety to the investor that the money will be repaid by the contractor. The model also provides for the financier to be repaid directly by the Western Cape Government for the funds provided upfront.
Having secured the goods or services needed, the small business is then able to fulfil its role as outlined in the tender.
One of the biggest projects undertaken through this model is the agreement between Wezan Building and Civil Construction and Bibby Apex Financial Services.
By securing R3.5 million upfront from Bibby Financial Services for materials, Wezan Building and Civil Construction were able to secure a tender for road construction from the Western Cape Department of Public Works.
Through this deal, Wezan, a Broad-Based Black Economic Empowerment (BBBEE) woman-owned company, was able to create 169 jobs.
“We know that small businesses are important job creators. This partnership between the Western Cape Government and the private sector is allowing emerging entrepreneurs to get the resources they need to do bigger business deals, grow their enterprises and create more jobs for our residents,” said MEC Winde.
Brian Tresidder, CEO of Bibby Apex, said the firm was eager to help new businesses which had excellent business plans and a sound proposition to secure deals.
For media queries, kindly contact:
Bronwynne Jooste
Tel: 021 483 3550
Cell: 082 454 4365
E-mail: bronwynne.jooste@westerncape.gov.za
