National Empowerment Fund (NEF)

The National Empowerment Fund (NEF) plays a crucial role in supporting Enterprise and Supplier Development activities in South Africa as part of its mandate to promote Broad-Based Black Economic Empowerment (B-BBEE).

It aims to facilitate economic transformation by providing financial and non-financial support to black-owned and managed businesses, as well as promoting a culture of savings and investment among black individuals and communities.

Driving economic equality: NEF's impactful push for preferential procurement

One of the key areas of focus for the NEF is preferential procurement, which involves encouraging the procurement of goods and services from black-owned businesses. By promoting preferential procurement, the NEF aims to broaden the reach of black equity ownership and prevent the dilution of black shareholding in the economy. The NEF recognizes the importance of transformation in management and staff as well, ensuring that black individuals have equal opportunities to hold positions of leadership and decision-making power.

To maximise the impact of its efforts, the NEF adopts an equity-based risk approach, balancing the risk with sound commercial decisions. The NEF's objective is to leverage equity-based risks in order to optimize the Empowerment Dividend and align with national priorities and government strategies, including AsgiSA and the DTIC's IPF. Through this approach, the NEF aims to make significant contributions to these initiatives, maximising their impact on economic growth and transformation.

The NEF also collaborates with other Development Finance Institutions (DFIs) to promote B-BBEE. By sharing its sector expertise and knowledge of B-BBEE, the NEF enhances the work of other DFIs and their mandates.

Transforming lives, empowering communities: NEF's impact on South Africa's economic landscape

Over the years, the NEF has played a significant role in driving economic transformation and empowerment in South Africa. Through its financial support, the NEF has facilitated over 1,349 transactions, totaling more than R12.466 billion, with a total project value of R21.44 billion. This support has resulted in the creation of over 114,000 jobs, of which 72,363 were new jobs.

In addition to financial support, the NEF has also been allocated funding for various programs and initiatives. These include the NEF Women Empowerment Fund, the COVID-19 Black Business Fund, the SME Distress Fund, the Black Business Manufacturing Enhancement program, and the Economic Recovery Fund. These allocations demonstrate the government's commitment to supporting the NEF's mandate and its role in promoting economic inclusion and empowerment.

With its sound governance ecosystem, the NEF has established itself as one of the model agencies across the public service. By continuing to focus on Enterprise and Supplier Development activities, the NEF is playing a crucial role in driving economic transformation and empowering black individuals, communities, and businesses in South Africa.

NEF (National Empowerment Fund) provides funding through seven different funds to support various entrepreneurial ventures. Here is an overview of each fund, their funding amounts, and their purposes:

1. Women Empowerment Fund (WEF)
   • Funding range: R250,000 to R75 million
   • Purpose: Accelerating funding provision to businesses owned by black women. It supports start-ups, expansions, and equity acquisitions in various sectors.
2. iMbewu Fund
   • Funding range: R250,000 to R15 million
   • Purpose: Supporting black entrepreneurs in starting new businesses or expanding existing black-owned enterprises. It offers debt, quasi-equity, and equity finance products.
3. uMnotho Fund
   • Funding range: R2 million to R50 million
   • Purpose: Improving access to BEE (Black Economic Empowerment) capital. It has five products: acquisitions, project funding, business expansion, investment in capital markets, and managing liquidity and asset storage.
4. Rural, Township & Community Development Fund
   • Funding range: Varies
   • Purpose: Promoting social and economic upliftment in rural areas. It supports sectors like agro-processing, eco-tourism, forestry, fisheries, commercial property, and non-farm activities.
5. Strategic Projects Fund (SPF)
   • Funding range: Varies
   • Purpose: Supporting early-stage projects in sectors aligned with the government's strategies on industrial development. Sectors include agriculture, textiles, mining, renewable energy, manufacturing, tourism, and more.
6. Arts & Culture Venture Capital Fund
   • Funding range: Varies
   • Purpose: Promoting and developing the arts and culture sector by providing affordable loans to start or expand small businesses. It aims to foster self-sustainability and job creation.
7. Tourism Transformation Fund (TTF)
   • Funding range: Up to R5 million (grant funding portion)
   • Purpose: Driving transformation in the tourism sector by supporting black-owned tourism enterprises. It provides a combination of grant funding, debt financing, and equity contributions.

These funds cater to different needs, such as supporting black women entrepreneurs, facilitating BEE capital access, fostering rural development, promoting strategic projects, empowering the arts and culture sector, and transforming the tourism industry.