Unlocking SME support through impact investing

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Could this investment vehicle be the key to assist small business and unemployment in South Africa?

Our unemployment rate has hit a record 35.3% and the many issues we are facing in South Africa are only worsening . Could Impact Investing be the ticket to spearheading more social entrepreneurs, more solutions and more access to finance for small businesses?

Impact Investing is a growing buzzword globally – a type of investment that generates positive, measurable, and sustainable environmental impact, and at the same time, financial return for investors.

It can unlock much needed short- and medium-term funding for small business that would otherwise not be able to access finance.

Speaking about this on a recent episode of The Cutting Edge Podcast series, Colleen Ebbitt, Vice President Global Philanthropy, EMEA at JP Morgan, says that the environment is right and that it is an exciting time to be working within the Impact Investing space in South Africa.

In conversation with host Nabeela Vally, Business Development Manager for Edge Growth, Ebbitt says that we need to see more traditional organisations such as banks also operating within the Impact Investing space.

Small businesses in South Africa are the cornerstone of our economy and job creation. Through collaboration with multiple players, we need to start thinking about what more we can do to unlock finance and better address our multiple social challenges.

The Abadali Equity Equivalent Investment Programme (EEIP) is an example of how Impact Investing can have real, meaningful and direct impact on the South African economy and job creation.

This is an initiative of JP Morgan and The Department of Trade, Industry and Competition (the dtic), and is administered through a joint venture between Edge Growth and short-term capital fintech company Profit Share Partners.

By directly addressing the major contributing factors to business failure which include lack of financial support and the inability to raise funds, The Abadali EEIP was launched last year to effect small business growth and entrepreneurship, drive black business growth and unlock short-term and mid-term lending for those that would otherwise struggle to get it.

This is one of many ground-breaking examples of how Impact Investing is making a real difference locally, specifically within the renewable energy, housing, health care, SME finance, agriculture and education sectors.

With the world reopening again after a challenging two years and with South Africa’s quintessential spirit of innovation and resilience, increasing opportunities to invest for positive change are emerging, with job creation and SME support being more important than ever.

As established small business development specialists, Edge Growth have/has? developed this podcast series to address arange of topics with various subject matter experts to unpack solutions to address barriers to SME Development and ESD success.

Listen to the full podcast here and go to https://edgegrowth.com/ for more information.

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