SME's receive R150m boost to hire young people

South Africa is grappling with a high youth unemployment rate of approximately 4.7 million people aged 15 to 34, as reported by Statistics South Africa in Q1 2026. Business Partners Limited, a state-owned company established in 1981, has allocated R150 million to help small businesses hire more young people. The funding, through the Small Enterprise Finance Agency (SEFA), aims to create nearly 1,000 new jobs for individuals aged 18 to 35.

The R150 million Youth Jobs Fund will be distributed to around 220 SMEs, providing financial assistance for labor-related costs associated with hiring new employees. Business Partners, which holds a 21.6% stake in the government-owned SEFA, launched the fund to support SMEs in growing their businesses and creating employment opportunities for young people.

MK Party, a political party focused on addressing unemployment, emphasizes the need for a comprehensive approach to tackle the issue. They highlight that many young people struggle to find employment despite the country's abundant resources and growth potential. Business Partners managing director Jeremy Lang believes that SMEs are crucial drivers of job creation in the country and are often the first to invest in young talent and provide workplace experience.

To be eligible for the funding, businesses must have at least two years of trading history, be viable and solvent, and demonstrate a clear plan for creating new jobs. The fund offers an initial six-month interest-only repayment period, with funding typically provided at an interest rate of Prime less 2%. The repayment period is 60 months, and the fund is structured as a loan with tranches paid out at milestones, with documented proof of employment required after each period.

Business Partners sees this initiative as an opportunity to address the pressing issue of youth unemployment, which has significant economic and social implications if left unresolved. The company emphasizes the importance of SMEs in creating job opportunities and the need for the government and private sector to work together to foster an environment where young people can thrive and contribute to the country's future.