Tuckshop owners in Gauteng, who were expected to benefit from a R100 million subsidy from the Gauteng Department of Economic Development to help them grow their companies, are furious because the department has failed to keep its promises.
According to sources, the R100 million Kasi Mnotho Fund was established in August 2021 by the then-MEC of Economic Development Parks Tau.
The scheme sought to help small firms in Johannesburg access necessary supplies, equipment, machinery, working capital, and strategic loans.
However, local company owners who were expected to gain from the initiative claimed it did not live up to its expectations.
The beneficiaries informed HowSouth that the cash were intended to be paid to them through a company named Family Tree Holdings (FTH), which they claim skimmed off the money for its own gain.
One of them was Neo Motaung of Katlehong, who owns a juice manufacturing firm and believes that the organization diverted monies intended to assist them.
Motaung claimed that near the end of 2023, he questioned the group about the reason for the payment delay and was then intimidated.
“The Family Tree Holdings promised to help us grow our businesses, and when I started asking about the delay of funds they told me to shut up or else they would take my life.”
“They lied to us and took the money that was supposed to help grow our businesses. This whole thing is a scam.”
Meanwhile, another tuckshop owner, Zodwa Nyathi, 59, said she was anticipating extending her business with the funding, but now her business was about to shut its doors.
Nthabiseng Magagula-Msomi, from Thokoza in Ekurhuleni, who owns a small cosmetics shop said they were told to pay a registration fee of R800 and R500 for protection fees by the organisation.
“They told us that if we don’t pay that money they would take us out of the programme. We thought they’re legit, and paid the money. But, even today nothing has happened,” she said.
“The Family Tree Holdings (FTH) was approved following an extensive due diligence. In total the Kasi Mnotho Fund is R100 million. The fund is designed such that any potential partner has to contribute matching funds , meaning that the FTH also contributed R50 million of their own funds.”
Ngobese said the department is aware of corruption allegations and it has taken measures to address them.
He said that the funds had not yet been disbursed to the beneficiaries and the programme had encountered challenges, with many business owners struggling to qualify to get the funds.
“This was due to various reasons including impaired credit records, operating businesses that are not formally registered.”
Ngobese added that the process of providing funds to the beneficiaries is set to begin this month.
