Banks need to go beyond BEE to help country meet its transformation goals
Banking sector has backed large deals, but funding small and medium enterprises will help create employment, writes Ubank CEO Luthando Vutula
As institutions that provide funding and credit to both consumers and businesses, commercial banks should be seen as key catalysts for SA’s socioeconomic transformation. Commercial banks have the power to influence ownership of, and participation in, the formal economy, not merely by doing black economic empowerment (BEE) deals that generally benefit only a few, but to make an impact on a larger part of society through significant financial support for black small businesses so that they in turn can help create employment. Simply put, while BEE deals are noble, these transactions have so far had a limited role in building operational companies that create a large number of jobs. Many BEE companies remain investment companies that create only a few direct jobs compared to operational small and medium enterprises, which each employ an average of five or more people. As a banker it is painful to confess that the country’s banking industry has been found wanting when it comes to providi...
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.