The Small Enterprise Development Finance Agency (SEDFA) is backing a new initiative that could reshape South Africa’s digital economy by helping black-owned internet providers expand into underserved townships and rural communities.
Through its partnership with Solcon Capital’s Tech Credit Fund, SEDFA is making up to R5 million in flexible financing available for small, black-owned internet service providers (ISPs) and fiber network operators. The funding is designed to help them expand networks, buy equipment, and secure working capital in a market long dominated by large players.
“This initiative focuses on supporting small, black-owned ISPs and fiber network operators to expand internet access in townships and rural areas,” said SEDFA Acting Chief Executive Officer Nkosikhona Mbatha.
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“It is a strategic intervention that not only creates opportunities for emerging service providers but also drives the digitalisation of township and rural enterprises.”
For many communities, reliable and affordable internet remains out of reach. According to Solcon Capital CEO Pramod Venkatesh, while demand for connectivity is growing, network penetration in rural areas remains low.
An estimated 22 million South Africans still lack regular internet access, limiting opportunities for digital inclusion, education, and business growth.
“What we are trying to do is bridge the gap for black-owned internet service providers and improve internet access. We want to close South Africa’s digital divide, with a focus on digital inclusion, economic growth, and innovation,” Venkatesh said.
He added that internet connectivity has become a lifeline for small businesses and households alike. From digital payments to customer engagement, connectivity determines whether township and rural entrepreneurs can remain part of the economy. Schools and learners also depend on stable internet access for education.
“If you look at education, healthcare, IT, and even artificial intelligence, access to the internet is critical. Without it, many small businesses and communities will be left behind,” Venkatesh said.
The partnership is expected to not only strengthen black-owned ISPs but also support township and rural businesses that rely on connectivity. With better access, local entrepreneurs can adopt e-commerce tools, improve customer service, and integrate with digital supply chains.
Nathi Mbele, the owner of Ad Notes Tech, whose ISP empowers SMMEs with reliable connectivity, said access to finance is critical for smaller ISPs that want to scale proven models.
“In our case, we’ve built a model that has been working for the past three years, reaching more than 10,000 households across five municipalities and supporting around seven SMMEs,” Mbele explained.
“With the right support, we want to duplicate this model and expand our reach to 25 municipalities. Funding is what will help us take that next step.”
Mbele added that better connectivity is not just about access to the internet but also about unlocking opportunities for township economies.
“When small businesses are connected, they can run payments more easily, reach new customers, and compete with bigger players. It also creates jobs in the communities where networks are rolled out,” he said.
