BLACK ECONOMIC EMPOWERMENT
Preferential procurement financing gives Ecsponent a leg up
Ecsponent’s Development Fund provides vendor financing and acts as a middleman in managing enterprise development
Black economic empowerment (BEE) codes and the National Credit Act, albeit well-intended pieces of legislation, are at odds when it comes to promoting procurement through black-owned businesses, says Terence Gregory, CEO of Ecsponent. Ecsponent invests in niche financial services businesses and manages preferential procurement for large companies. In terms of the new BEE codes, a third of a business’s procurement spend was expected to be obtained through black-owned businesses, Gregory said on Tuesday. "On the other hand, you cannot lend to an individual who can’t pay you back, because that is reckless lending under the National Credit Act. So how do these chaps get any form of funding?" Vendors that were unable to access funding or lacked the skills to procure goods cost-effectively could not access supply chains. "We see this as a tremendous opportunity." The complexity of the BEE codes has spawned an industry that advises large companies on how to meet scorecards. The Ecsponent D...
Would you like to comment on this article?
Sign up (it's quick and free) or sign in now.
Please read our Comment Policy before commenting.
Subscribe now to unlock this article.
Support BusinessLIVE’s award-winning journalism for R129 per month (digital access only).
There’s never been a more important time to support independent journalism in SA. Our subscription packages now offer an ad-free experience for readers.
Cancel anytime.
Questions? Email helpdesk@businesslive.co.za or call 0860 52 52 00. Got a subscription voucher? Redeem it now.