Stella Ndabeni-Abrahams promises better funding for small businesses
Small business development minister Stella Ndabeni-Abrahams is promising better funding opportunities for small and medium enterprises.
Ndabeni-Abrahams told a mini plenary of the National Assembly on Tuesday how the finalisation of the funding policy by her department would open doors for funding of small businesses which often struggle to get funding from commercial banks.
She was presenting the budget for her department.
“Our work here is aimed at reducing the prevailing credit gap estimated to be R346bn, honourable members. That is the gap in funding SMMEs in SA,” said Ndabeni-Abrahams.
She said the finalisation of the funding policy, named South African SMMEs and Co-operatives Funding Policy, will create a seamless flow of funding from financiers to small enterprises.
“Through the Small Enterprise Finance Agency (Sefa) we will prioritise building a sustainable loan [scheme] through the expansion of credit and decreasing impairments. We are also building on the success we have had with credit guarantees which have been able to leverage additional monies from private banking and non-banking financial intermediaries.
“Here we will deliberate in building a sustainable, black-owned financial intermediary base. This is critical to our success,” said Ndabeni-Abrahams.
She said they wanted to speed up turnaround times for applications to SEFA, after receiving complaints.
“We are also undertaking measures to increase access to rural areas and townships through improving our visibility,” she said.
Ndabeni-Abrahams said her department was confident there will be equitable fund flow across provinces.
She said the R2bn Sefa funding allocated for the 2022/23 financial year will see at least R200m worth of funding disbursed to small businesses in each of the nine provinces.
“[It will be] slightly more for the poorer rural provinces such as Limpopo, Free State, North West, Eastern Cape, Mpumalanga and Northern Cape. We are deliberate about redress and we can't apologise,” said Ndabeni-Abrahams.
She said the money was expected to support 84,831 SMMEs and co-operatives. It is also expected to help in the creation of 104,968 jobs.
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