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sefa Annual Results & Development Impact 2013: Success Stories & Loan Products

Explore sefa's annual results for the year ending March 2013 and its impact on SMMEs through loan products and success stories. Discover growth strategies, stakeholder engagement, and the reach of sefa's services across different provinces.

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sefa Annual Results & Development Impact 2013: Success Stories & Loan Products

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  1. ANNUAL RESULTSfor the year ended 31 March 2013 Select Committee Economic Development 4th Cape Town

  2. Introduction • First year of operations was characterised with a focus on implementing the merger, including organisational change management, human capital integration, IT systems and processes and the development of enterprise-wide policies and procedures. • These processes have laid the foundation for sefa to deliver on its key strategic objectives. Establishment Target market consists of those small businesses not served by the existing formal banking and finance sector within the following categories: • Survivalists and microenterprises –loans of between R500 and R50 000 • Small enterprises – loans between R50 000 and R1 000 000 • Medium enterprises – loans between R1 000 000 and R5 000 000 • Lending strategy is informed by IPAP, NDP, NGP, MTSP and other imperatives and legislation Target market

  3. Khula Direct Pilot (pre-merger)

  4. Khula Direct Pilot Results • Pilot phase capitalised with R55m (R50m for on-lending and R5m for capacity building) • 3 Pilot branches • Tshwane, • East London • Cape Town • R23.4m Approvals • R12.7m Disbursement • 98% Collection Rate • 0% Impairments • Implementation challenges • Credit skills and capacity • Concentration on bridging loans • The pilot project preceded the sefa business model

  5. Product Portfolio Performance

  6. Loan Product Portfolio Mix

  7. sefa Delivery Structure 9 Regional Offices 6 Financial Intermediaries 8 Equity and Specialised Funds Head Office - Centurion 5 Commercial Banks 13 Microfinance Institutions 10 Fin. Service Co- operatives

  8. Support for Co-operative Enterprises

  9. Loan Products Performance

  10. Provincial Analysis - Approvals

  11. Provincial Analysis - Disbursements

  12. Performance against Target and Development Impact

  13. Development Impact of Loan Product Portfolio Disbursements to SMME via all Loan Products/ Channels

  14. Impact Indicators

  15. Loan Products Performance

  16. Outreach and stakeholder Participation • Roadshows • sefa led Roadshows together with Seda, SARS, NYDA, IDC, dti, EDD, Provincial Development Corporations and Local Government LED units and local Chambers of Commerce • 19 Towns in 8 Provinces • Community/ National Radio Stations • Message – raising awareness of sefa products and other government SMME services • Stakeholder Feedback • Access to sefa office (visibility and accessibility in small towns) • Loan/ Disbursement process (Turnaround times, Document requirements) • Interest Rates • Access to loans, < R50k (Micro-finance Institutions • Customer Channels • Online Enquiries – 887 • Call Centre - 6203 • Regional Office Offices- 2426 • Building the sefa brand and stakeholder awareness/ outreach is ongoing strategic priority • strategic partnership (MOU’s) • NYDA (youth entrepreneurship) • IDC – Downstream small business development opportunities (industrial financing, renewable energy) • Seda (non-financial support to entrepreneurs – pre-loan support services, co-location) • South African Institute of Chartered Accountants (SAICA) – post loan mentoring (management accounts) • Provincial Development Corporations

  17. Success Stories

  18. Success Stories - Microfinance • Ms Vuyiswa Bheyi, started her fruit and vegetable enterprise through loan financing from Tetla Development Services, a sefa funded Microfinance Institutions • She is self-employed and able to provide for her family. • Many other micro enterprises, especially rural women and youth are provided with an opportunity to participate in the economy

  19. Success Stories – Retail Financial Intermediary • Mr Mqwathi, the owner of SSS security services received term loan R1,8 million and revolving loan facilities from a Free State retail financial intermediary (Retmil). • SSS security employs 1,500 staff members in the Free State and North West Provinces

  20. Success Stories - Direct Lending • Ms Magdeline Paledi, the co-owner of MMJV, obtained a bridging facility of R3 million. • The bridging facility enabled the Joint Venture to honour the contract received from Anglo American. • The funding assisted in the development of a village school in Burgersfort

  21. Success Stories – Direct Lending • sefa provided a bridging loan of R3 million to Mr Wilson Khetisa Matete of BBT construction based in Mangaung, Free State. • The funding enabled BBT to a service large construction contract amounting to R10 million for the construction and maintenance of roads in the Botshabelo and Bloemfontein areas. • The enterprise employs 165 staff.

  22. Success Stories – Co-operatives Pam Govender is a Member of K.Ladies Financial Cooperative. She is an entrepreneur and owns a construction company (Alpha Trading ) and employs four people. Her business obtains loans from K.Ladies because of being a member. Her business is involved in making gates, repair bridges etc. The picture on the right demonstrates the work done by Alpha Trading in Ladysmith, KZN. Pam was one of the winners of 2013 City Bank micro-entrepreneurs. K.Ladies assisted her to register for the competition. Beauty Gcilitshana of Khayelitsha , a member of Flash , started her fruit and vegetable stall to feed her family in 2010. She is currently employing two employees. She has bought a van for her business, renovated her house and sends her kids to school. She is very happy with the SACCO’s services. Ms. Rachidi M.Hellen is a member of Mankotsana Financial Co-op based in Limpopo .She received a loan from the co-operative in 2012 to extend her house. She has now achieved her goal of having a decent house. The picture below shows the house at the time of the extension. Flash is one of biggest Financial Co-ops funded by sefa and has approximately 9000 members who are SMMEs.The members are Flash Vendors who sell electricity and airtime. sefaapproved a total amount of R4 million i.e. R2 million on-lending loan and R2 million capacity-building grant. A total amount of R3, 723,665 was disbursed. The current exposure to sefa stands at R276, 335.

  23. Success Stories – Youth • On Point Manufacturing a steel fabrication and engineering design enterprise was awarded an order to manufacture conveyor belt components for a platinum mine. • The business operates from Steelpoort in the Sekhukhune district in Limpopo. • The owner, Mr Dumetsi Masha, received R600 000 loan from sefa. • Miss Lungile Nkosi, the owner of Lee 0108 Trading Enterprise, operates a slimming clinic in Centurion, Gauteng. • The clinic provides a non-invasive slimming treatment. • sefa provided R520 000 loan for the business.

  24. Human Capital Management

  25. Human Capital Management Establishment Profile – 31 March 2013 • Black representation constituted 92% and female employees 69% of sefa staff. • Human capital management activities included: • The establishment and approval of the organisational structure • Transfer and placement of employees into the new organisation • Implementation of change management programmes • Integration of the ex-SAMAF and ex-Khula regional offices • Development of sefa integrated human capital related policy framework. • Addressing on-going merger related challenges

  26. Financial Performance

  27. Statements of Financial Position as at 31 March 2013

  28. Statements of Comprehensive Income for the year ended 31 March 2013

  29. Assets

  30. Income • Income is mainly derived from: • Property rentals, • Dividends, • Interest

  31. Expenses

  32. Building sefa The Way Forward

  33. Building sefa – The Way Forward • Improving Organisational Efficiencies • Improving Turnaround Times • Improving the sefa Balance Sheet • Cost to Income • Post Investment Monitoring (Mentorship and collections) • Strengthen Human Capital Management • Policies, procedures, processes and systems • Stabilizing the labour relations environment (Co-operation with the union) • Organisational Change management and culture (embedding the merger) • Performance Management • Skills Development (Developing sefa’s core competencies)

  34. Building sefa – The Way Forward (Cont) • Investment in target programme initiatives • Youth (Fund/ Scheme) • Micro-Enterprise Supplier Credit • Fresh Produce Markets • Construction (Building Material) • Clothing and Textiles • Retail (Wholesale and Manufactures) • Geographic enterprise development Initiatives • Co-operatives • Bakery Enterprises (Rural Women) • Structured financing packages for Co-ops • On-lending financial support for Financial Savings Co-operatives • Investing in strategic partnership • seda, SAICA, Provincial Development Corporation, • Private Sector (supplier development

  35. THANK YOU

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