Thungela and Absa join forces to empower SMMEs through R200m co-funding agreement
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The programme focuses on cultivating local businesses through the provision of business skills training and coaching, access to funding and technical enablement. Image: Supplied
Thuthukani, Thungela’s Enterprise and Supplier Development (ESD) programme, has announced the signing of a co-funding agreement with Absa.
Absa said it would reserve R200 million, reviewable annually, for Thuthukani beneficiaries using their new or existing contracts with Thungela as collateral.
Thuthukani derives its name from the Zulu word meaning “uplift”.
The programme focuses on cultivating local businesses through the provision of business skills training and coaching, access to funding and technical enablement.
This co-funding agreement further empowers them to seize opportunities within Thungela’s value chain.
Mpumi Sithole, executive head for corporate affairs at Thungela, said: “I am pleased that our partnership with Absa will make funding more accessible for local SMMEs with new and existing contracts with us. In 2023, Thuthukani disbursed R21.6 million in loans, leading to the creation of 114 jobs.
“To this end, we could not support businesses requiring loan funding beyond this threshold, as larger contracts require substantial funding that Thuthukani alone could not provide. This partnership with Absa will close this funding gap for SMMEs, opening opportunities for them to pursue larger projects.”
Absa will manage the loan application process on their ESD portal, subject to a recommendation from Thuthukani.
The portal ensures funds are accessible to the approved beneficiaries, offering loans at a prime-linked interest rate.
Kgalaletso Tlhoaele, executive for enterprise development at Absa Relationship Banking, said: “This agreement highlights Absa’s dedication to enabling financial inclusion for SMMEs while also fostering sustainable economic growth across various sectors.
“The allocation aims to provide substantial financial support that empowers SMMEs to expand, innovate and achieve long-term sustainability.
“It also underscores our commitment to being an active force for good in society – enabling us to achieve our goal to support mining communities and create a robust environment where small and medium enterprises can thrive.”
This partnership targets SMMEs in municipalities hosting Thungela’s operations such as eMalahleni, Steve Tshwete and Govan Mbeki municipalities.
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