Cape Town - THE Banking Association of South Africa (Basa) provided R33.61 billion in payment breaks on credit agreements to businesses and individuals in financial distress due to Covid-19 since October 24.
This was revealed by Finance Minister Tito Mboweni when he responded to parliamentary questions from DA MP Hendrik Kruger.
Kruger asked about the number of SMMEs that were successfully assisted with payment breaks on credit agreements and under the loan guarantee scheme since September 27.
Kruger also asked about the measures the National Treasury had put in place to ensure that more SMMEs received appropriate and sufficient financial assistance.
Mboweni said more than 83% of individuals and 95% businesses who requested help with personal and home loans, vehicle finance, business mortgages and credit facilities received the required assistance.
“This cash flow relief for 2 684 271 credit agreements for eligible individuals and 135 540 businesses was critical to the preservation of quality of life, jobs, businesses and the functioning of the economy,” he said.
The minister said the last update on the loan guarantee scheme released by Basa, as at June 19, showed 13 324 loan applications were approved for SMMEs within the various turnover bands, with a total rand value of R18.39bn.
“The majority of approved applications were submitted by SMEs with a turnover greater or equivalent to R1 million but less than R20m,” he said.
Mboweni said the National Treasury did not have information on SMMEs that were denied payment breaks on credit agreements as it was bank-specific and covered financial assistance beyond the loan guarantee scheme.
He said Basa had indicated that at least 83% of individuals and 95% of businesses that requested help received assistance.
“This implies that 17% of individuals and 5% of commercial enterprises, respectively, did not receive financial assistance as a result of their respective credit facilities not being up-to-date in terms of repayments credit agreements.”
Mboweni said 28 430 Covid-19 loan guarantee scheme applications were rejected, as at June 19.
“Applications were rejected since, inter-alia, they did not meet the eligibility criteria for the scheme, as set out by National Treasury and the South African Reserve Bank, or because they did not meet commercial bank’s risk criteria.
“In some cases, applications were rejected as a result of outstanding financial records or documentation not submitted; or the loan value requested was either too high, being in excess of the R100m maximum loan amount requirement, or that the reason for the application was not a Covid-19 related matter/distress.”