It is day six of the national lockdown and, it this time, it is the local SMMEs (Small-Medium-and-Micro-enterprises) that are some of the hardest hit as a result of COVID-19.
Particularly those in the informal sector as these firms do not have the necessary financial measures in place to keep the business running and pay its employees while the doors have been forced shut.
To assist in this regard, government earlier this week detailed some of the interventions it has developed for SMMEs in the informal sector. Unpacking the interventions was small business development minister, Khumbudzo Ntshavheni, who highlighted government’s Debt Relief Financing Scheme and Growth Resilience Facility for SMMEs.
The minister added that the qualifying criteria, as well as online applications, would be made available tomorrow (2nd April), but applications are currently being processed manually too.
Added to this, turnaround time for approval of applications is expected to be seven days at worst, according to Ntshavheni, with disbursement of funds expected to take up to a further five days.
The minister made special mention of the efforts being made for spaza shops during this time, with a support scheme being created, as well as a credit facility for them to purchase, along with other value-added services and tools like bookkeeping, payment facilities and customer service training.
“We are also supporting them with business management support because we know that there are problems in spaza shops running their businesses to be profitable,” noted Ntshavheni.
The minister also explained that interested parties wanting to make applications, will also have to have the correct documents available from the relevant authorities in order to do so – Companies and Intellectual Property Commission (CIPC), South Africa Revenue Services (SARS) and Unemployed Insurance Fund (UIF) registrations.
“They must provide proof of banking and must be registered on SMMESA. Spaza’s must have a permit to trade and municipalities are ready to assist with this,” the minister concluded.
As with many of the government-led initiatives being unveiled at this time, it is always best to be cautious, as these relief efforts may be aimed at helping SMMEs during the lockdown and COVID-19 pandemic, but they are also loans, and will need to be repaid at some stage.
As such an SMME will need to weigh up how much it is willing to take on, with a view of repaying it at a later stage.
To find out more information about the SMME-focused interventions and register your interest, head here.