By Nozizwe Vundla, Head of the Sanlam Foundation

The unsung heroes of South Africa’s economy are our entrepreneurs, who drive growth and innovation through their small and medium enterprises (SMEs). These businesses make up 98.5% of formal businesses in the country (Stats SA, 2022) and account for 34% of the GDP.

Despite its importance, South Africa’s SME sector growth remains slow. Early-stage entrepreneurship rates are 3.5 times lower than the global average, according to the Global Entrepreneurship Monitor (2022). Furthermore, SMEs face significant challenges, including limited access to funding, with 70% struggling to access credit (FinMark Trust, 2022). Skills development is another major barrier, with 45% of SMEs citing lack of skills as a major constraint (SEFA, 2022).

To address these challenges, Sanlam is committed to championing SMEs through our Enterprise and Supplier Development (ESD) initiatives. The goal of the Sanlam Foundation ESD programmes is to empower SMEs to drive economic growth, job creation, and financial inclusion.

Entrepreneurship is crucial for unlocking South Africa’s demographic dividend potential and addressing socio-economic disparities. Our ESD programmes aim to create lasting economic sustainability, helping entrepreneurs thrive and contribute to the National Development Plan’s (NDP) vision of amplifying SMEs’ impact on the economy.

Purpose-Driven Programmes

Sanlam Group ESD Programme:

This programme seeks to provide impactful business support to high potential Black-owned businesses with the intention of ensuring equitable participation of Black-owned SMEs in the supply chain of the Sanlam Group.  The 2023 cohort saw a 33% growth in revenue in the below programme streams:

  • Project Accelerator: Provides business development support to 14 SMEs, focusing on market access, funding, and skills.
  • Project Elevate: Targeting 24  financial planning firms, this programme provides specialist training within Sanlam’s BlueStar network of financial planners.
  • Project Migrate: This programme provides business development support to 11 financial planning businesses.

Black Women-owned SME Programme:

This is the first ever ESD programme in Sanlam that focuses solely on women SME owners. The programme is delivered virtually and the 2024 cohort consists of 29 businesses across South Africa.

There are three programme streams, focusing on SMEs in different stages of the business life cycle:

Masakhe – is a six-month long programme targeting early-stage businesses for entrepreneurs in the ideation, pre-revenue, or start-up phase of development or establishment.

Siyakhula – is an eight-month long programme that is designed to help owners of established businesses to identify growth opportunities and overcome current business challenges.

Asindize – is a twelve-month long programme that aims to propel high growth potential businesses forward by connecting them to the right funding and market access opportunities.

Sanlam Leruo Stokvel Programme is dedicated to formalising stokvels into viable businesses. With over 800 000 stokvels in South Africa managing R50 billion annually, this sector plays a key role in improving the national savings rate, currently at a low 16% of GDP. Initial impact has already been felt, with 5 stokvels supported, translating to 152 members empowered to take control of their financial futures and contribute to the country’s economic growth.

SMEs: South Africa’s Hope

Supporting SMEs is vital for fostering financial inclusion and unlocking opportunities for all. This country’s greatest strength is its people, who have grit, humour and the indomitable drive to change their fortunes. Sanlam is determined to help them do this.

Click here to download the 2024 Sanlam ESG Barometer Report  https://sanlamesgbarometer.co.za/report-2024/

Click here to watch the 2024 Sanlam ESG Barometer Conference https://www.youtube.com/live/gL2TmbPfhqo