In a province where low economic growth and high unemployment rates are the norm, a business owner is trying to turn joblessness around for his village with the help of a R3 million loan from the Mpumalanga Economic Growth Agency (Mega).
Mega provides funding ranging from R10 000 to R3 million to business owners who aim to buy, establish or expand a business and to companies seeking bridging finance, additional equipment, stock or working capital.
Mega was formed in April 2010 through the merger of the Mpumalanga Economic Growth Agency, the Mpumalanga Housing Finance Company, and the Mpumalanga Agricultural Development Corporation.
Mega provides development funding to black business owners in the province as well as foreign trade and investment opportunities to enhance enterprise development.
Rex Machabi, the owner of Ntila Spar, says a loan from Mega was used to buy, build and start a Spar supermarket franchise in the village of Ximhungwe.
Machabi, who is currently employed by the South African Police Service as Mpumalanga’s deputy provincial commissioner, intends to resign as soon as the business takes off.
The Spar was officially opened on 25 July 2013.
He says he also received R12 million in funding from the National Empowerment Fund, which came on board as a co-funder. He also contributed R1 million of his own money to the project.
Machabi says he will use some of the money to build a hardware store and a clothing shop, as such businesses want to open outlets next to the Spar.
The Spar has created 52 direct jobs, and a further 198 jobs were created during the construction phase of the business.
Machabi says that besides the financial support from Mega, he also receives regular visits and business advice from Mega advisors. Spar also provides him with mentorship and support.
Mike Biyela, general manager of business development at Mega, says Machabi was awarded the loan because his business proposal was viable and compelling.
“The business also has the potential to have a huge economic and social impact on the rural community of Ximhungwe,” says Biyela.
He advises business owners who want to apply for funding from Mega to ensure that they do their research when putting together their business proposal and to find out how existing businesses become successful. He says seeking finance for a franchise would probably be the ideal way to go.
According to Biyela, businesses in all sectors can apply for funding, but Mega especially looks for businesses in the manufacturing sector that can take advantage of the raw materials Mpumalanga has to offer.
Businesses are encouraged to apply for funding by sending their business proposals to Mega’s regional offices in Bronkhorstspruit, Secunda or Nelspruit.
Businesses who want to do business with Mega need to register as a supplier on the agency’s database.
- Go to www.mega.gov.za to apply for funding or to register as a supplier.