In a huge vote of confidence in SaveAct’s work, the South African government has, for the first time, partnered with us.
SaveAct has entered into a three-year agreement with the Jobs Fund, whereby the agency will fund the mentorship and graduation of 10 000 savings group (SG) members and the support of 1000 micro-enterprises. Funding of R11,5 million by the Jobs Fund will be matched with an equal amount from four organisations that are already supporting SaveAct—Misereor, BMZ implemented by GIZ, SAB Foundation and the Industrial Development Corporation (IDC).
The Jobs Fund is a government initiative launched in 2011. Its brief is to act as a catalyst for activities that directly contribute to sustainable job creation initiatives, by co-financing the organisations behind these projects. The fund is an initiative of the Treasury, which, according to SaveAct programme manager Isabel Arzeno, is interested in the potential of SaveAct’s model.
“The main focus of the Jobs Fund is jobs but they are also looking at income-generating activities. Getting involved with SaveAct is not typical of what they do, but they are trying to see if they can showcase something that is working on a small scale, that could be relevant for social grant recipients wanting to start an enterprise.”
Arzeno says the Jobs Fund, whose focus is on employment and youth, is interested in how savings group members secure finance for enterprise development. The fact that most SG members use part of their social grant for saving, which is then used to provide loans to members, is of particular policy interest.
In terms of the contract with SaveAct, the Jobs Fund is supporting 10 000 new SG members who will receive training in establishing and running a SG, as well as financial education. They must all graduate from a group. Of these 10 000 people, 1 000 will be required to increase their income by a minimum of 10% per annum, by starting a new enterprise or investing in something they are already involved with.
There are three categories in this group of 1 000. One hundred and seventy of them will be people growing produce, who will try to link with contract growers or more formal buyers.
One hundred will be newly trained resellers, who establish self-generated jobs through SaveAct’s Zis’Ukhanyo programme, by selling a range of household products. Resellers must pay upfront for their merchandise. Record keeping and training have been introduced.
Finally, 741 will be mostly rural women who are SG members and, through the use of loans from their groups, show an improvement in their existing livelihoods.
Members trying to develop their livelihoods into enterprises can ask for training and support if needed, although this will probably be from a remote source, such as an online expert.
The idea is to build value chains with links to local and regional markets, while farmers will be assisted to access these markets.
Entrepreneurs will also have access to farm/enterprise inputs to help build resilience and achieve their output targets.
Two of SaveAct’s oldest partners —Justice and Women (JAW) and Ubunye Foundation—are being drawn into the project and some of their members will be involved in these activities. Scientific Roets and the Spar group will also be involved.
The timescale for the project is October 2019 to September 2022.