The National Treasury’s Jobs Fund has selected Sasfin Asset Managers (SAM) and RBN Fund Managers to create a blended finance investment vehicle that expands small and medium-sized enterprises (SMEs) lending and job creation in South Africa.

The Jobs Fund is a multiyear R9-billion National Treasury initiative established in 2011 to encourage innovation and support initiatives with the potential to generate sustainable employment.

“Investing in the future of South Africa means investing in the future of its people. By creating jobs, we not only empower individuals, but we also strengthen communities and build a more sustainable economy for all. We are very excited to partner with RBN and National Treasury via the Jobs Fund to contribute to this future,” comments Sasfin Wealth CEO Erol Zeki.

The Jobs Fund has awarded the SAM/RBN partnership a grant of R85-million over two years to catalyse increased access to credit for marginalised SMEs, leading to direct job creation.

This will be structured as a guarantee mechanism to leverage an initial R360-million in matched funding from Sasfin Group and institutional investors. The intended outcome is to establish a credit-enhanced fund that generates 1 200 permanent and 320 short-term or temporary jobs over the initial two-year period.

“SMEs continue to be important creators of new jobs in the economy, yet their growth is often thwarted by the lack of access to appropriately structured finance and technical support.

“A range of funding sources and products are required to address this challenge. The Jobs Fund Sasfin-RBN initiative will contribute to bridging this gap for growth-orientated SMEs,” says Jobs Fund head Najwah Allie-Edries.

This initiative highlights the synergies between SAM and RBN to drive its combined impact investing strategy as partners in the impact space.

Members of the RBN impact investing team have successfully implemented three previous projects with the Jobs Fund, and will project manage the new initiative, coordinating the implementation of the project and fulfilling all reporting requirements.

SAM will fulfil asset management responsibility and enhance its credit capability. Sasfin Bank, will be an implementation partner in deploying direct loans to job-creating SMEs.

The two-year goal is to build a successful portfolio of SME loans, which produces strong commercial returns and a high social impact through job creation.

A successful pilot will produce the ability to further leverage the guarantee to attract additional institutional investors and scale this impact solution. This opportunity allows collaboration across public and private sectors and to demonstrate how a guarantee can reduce credit rationing, create jobs, and over time crowd in additional funding for Sasfin’s SME lending engine.