While this budget is to be welcomed, SMMEs face problems ranging from accessing loans to entering new markets or just surviving, writes Andile Ntingi
While this budget is to be welcomed, SMMEs face problems ranging from accessing loans to entering new markets or just survivingThere was a strong expectation that finance minister Tito Mboweni would deliver an early Christmas gift to thousands of small business owners when he tabled his annual budget yesterday.
The amount of cash that Mboweni has allocated to support SMME development should be applauded, given the woefully inadequate allocations he made in 2019, which did not go down well with the small business community given its neglect over the years. Then he allocated a paltry R481.6m to Seda to expand small business incubation programmes, but announced no significant SMME-boosting incentives.
While this budget is to be welcomed, SMMEs are faced with a number of challenges, ranging from accessing loans to entering new markets or surviving in the markets they already operate in. A growing number of small business development experts are arguing that there is no shortage of funds to finance the SMME sector, but what stifles the flow of funds into the sector are restrictive funding models of credit-granting institutions.
Other reforms in the pipeline that Mboweni is working on include the Public Procurement Bill, which will result in amendments to the preferential procurement policy to pave the way for the introduction of set-asides, whereby a significant portion of government procurement will be ring-fenced for small suppliers and black-owned businesses.
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