Desperate small businesses scramble for Rupert and Oppenheimer lifelines
Applications for the Sukuma Relief Programme have already exceeded the R1bn donation by three times, forcing the fund to temporarily shut down
The fund created by the Rupert family to assist small and medium-size businesses in financial distress as a result of Covid-19 has been temporarily shut down as a result of a huge oversubscription from desperate SMMEs.
Applications to the fund escalated to a huge R2.8bn in the space of a couple of days, much more than the R1bn made available by the family. The thousands of applications the separate initiatives of the Rupert and Oppenheimer families have received in just a few days to assist small and medium-size businesses reveals the extent of the trauma being experienced during the lockdown.
Business Partners, which was appointed by the Rupert family to administer the Sukuma Relief Programme, says that it received more than 10,000 applications.
“The volume of applications we have received opens your eyes to the suffering and destruction that our SMEs and microenterprises are enduring at the moment. Many small businesses just don’t know where the next pay cheque is coming from,” says Business Partners executive for marketing Gugu Mjadu.
The company has now temporarily closed the portal for applications as it works to provide a response to applicants within seven days.
The disbursements comprise a one-off non-repayable grant of R25,000 per business, plus unsecured loans of between R250,000 and R1m that are interest-free and non-repayable for the first year. The loans are intended to tide businesses over for the period of the lockdown and the immediate aftermath and will be disbursed over a three-month period beginning in April to help small businesses cover overheads such as rent and salaries.
The Rupert family is creating a trust in which to house the programme, which will operate separately from the ongoing commercial activities of Business Partners. The family is still deciding what purpose the charity will serve after the pandemic, but may likely remain an emergency fund for small businesses during economic downturns.
The R1bn donation from the Oppenheimer family is being administered through the newly launched SA Future Trust (SAFT), which is working through the country’s four largest banks. In the space of two working days — Friday last week and Monday — the trust received 10,000 applications, putting it on track to begin disbursing R250m in loans “over the next 48 hours”, it said on Monday.
The trust, which is a public benefit organisation and can therefore accept donations from third parties, will make interest-free loans available to SMMEs for the express purpose of paying a portion of workers’ salaries — equivalent to R750 per employee per week for a period of 15 weeks.
The loans are unsecured, interest-free and repayable over a period of five years. Any money repaid will flow back into the trust and will be used to facilitate the growth of SMMEs in the future.