Small Business Development Minister Khumbudzo Ntshavheni. File photo: ANA/Timothy Bernard
Small Business Development Minister Khumbudzo Ntshavheni. File photo: ANA/Timothy Bernard

Small Business Department announces further Covid-19 aid for small, informal businesses

By ANA Reporter Time of article published May 23, 2020

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PRETORIA – Small Business Development Minister Khumbudzo Ntshavheni has announced the second-wave of coronavirus (Covid-19) pandemic support for informal, micro, and small enterprises, including cooperatives based in townships and villages, in addition to the spaza support scheme, her department said on Saturday.

The dedicated support programmes for township and village-based enterprises were in line with the department’s township and rural entrepreneurship programme (TREP) approved by Cabinet in February 2020, the small business development department (DSBD) said in a statement.

“With the re-opening of the economy, the township and village economies require special focus if government is to achieve the aspirations of the new economy post-Covid-19 which were clearly articulated by President Cyril Ramaphosa,” Ntshavheni said in the statement.

Qualifying entrepreneurs could apply for the small-scale bakeries and confectioneries; informal and small-scale clothing and textile; and the automotive atermarkets support schemes.

The small-scale bakeries and confectionaries business support scheme was intended to assist with the purchase of business equipment and provision of working capital. It was a stepped-up access to market through off-take agreements, eg with spazas on the DSBD spaza support scheme; and access to bulk buying facility for raw materials through participating wholesalers.

Ntshavheni was committed to ensuring that spaza shops become critical markets for products made by other small businesses as part of a programme to make sure that money circulated longer in townships and villages, thus transforming the shape and form of these economies.

The small-scale and micro clothing and textile business support scheme for enterprises located in townships and villages was aimed at supporting small-scale, micro, and informal businesses in the clothing and textile industry to:

- seize opportunities in the sector availed by the Covid-19 pandemic such as production of personal protective equipment (PPE) in the Covid-19 response value chains and beyond;

- participate in rebuilding and restructuring the clothing and textile sector as necessitated by the emergence of the new world order; and

- improve the quality and competitiveness of small-scale clothing and textile enterprises for both domestic supply and export market.

Ntshavheni believed "the economic climate will witness either a consolidation of big clothing retailers and manufacturers into fewer players or demise of the same post Covid-19".

"Any of these unfortunate consequences will invariably create an opportunity for small players, including cooperatives that at times will be formed by former workers of these giants to participate as owners of their businesses in the sector," she said.

The scheme covered the cost of production inputs; access to credit; assistance with compliance and technical skills improvement, eg labelling, industry standards and quality; and business and financial management training, including productivity management.

Regarding the automotive aftermarkets support scheme, Ntshavheni "has noted that the prevailing economic conditions in South Africa will increase demand for cheaper motor services and motor body repairs, and thus creating a demand for reliable vehicle service at an affordable rate".

The scheme was intended to support qualified motor body repairers (panel beaters) to operate accredited small/independent body repairer centres; support qualified motor mechanics to operate authorised service centres; support small/independent auto-spares shops to serve as distributors of automotive aftermarket spare parts centres; and support informal fitment centres to become micro but formal fitment centres.

The support covered, among other things, working capital, facilitating accreditation of the small/micro enterprises, and participation in a Small Enterprise Finance Agency (Sefa)-backed revolving credit facility through participating banks, between participating motor mechanics/motor body repairers, and with participating auto spares shops and fitment centres, she said.

Application forms for the schemes would be available online on https://smmesa.gov.za/ from Wednesday, May 27, and more details were available on all the department's websites.

She also announce that Standard Bank had also partnered with Sefa on the spaza support scheme, which added to the already existing partnership with Nedbank.

“We are resolved not merely to return our economy to where it was before the coronavirus, but to forge a new economy in a new global reality, to restructure the economy and achieve inclusive growth. We will forge a compact for radical economic transformation that advances the economic position of women, youth, and persons with disabilities, and that makes our cities, towns, villages and rural areas vibrant centres of economic activity,” she said.

African News Agency (ANA)

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