SMMEs exposed to funding
ALEXANDRA – Alex SMMEs exposed to government funding.
Small, micro and medium enterprises (SMMEs) and aspirant entrepreneurs in Alex will be able to get financing from the Department of Small Business Development, provided they present convincing business proposals.
This was said by the department at a Greater Alexandra Chamber of Commerce and Industry workshop at a time when the country is in a recession, prompting businesses to seek stable options for survival. The government is looking to support business options to assist in creating employment and reducing incessant poverty.
Don Mashele of the department, said the financial support would target primarily youth, women, disabled entrepreneurs, SMMEs, which have an historical footprint in townships and rural areas, and cooperatives in formerly disadvantaged areas.
Loans of R50 000 to R5 million will be made available, which will be coupled with mentorship support.
“The loans are repayable within a five-year period and subject to performance,” he said.
“They are given as direct lending for assets, bridging and revolving loans, for wholesale lending as credit guarantees, working capital and as non-financial support like mentoring, managerial and technical support. They [loans] have an interest of 6 per cent for the disabled and above this figure for the other groups, based on risk factors.”
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Applicants must be:
- South African citizens or have permanent residence
- Have their businesses registered in the country and have a fixed address
- Comply with the required criteria stipulated in the application form and the general corporate governance practices
- Submit a compliant business proposal and plan
- Demonstrate ability to repay the loan
- Provide credit references and relevant collateral
- The majority shareholder
- Have a valid tax clearance certificate.
Excluded are:
- Labour brokers
- Gun and ammunition manufacturers
- ‘Sin’ trading such as tobacco, alcohol, gambling and the sex trade
- NPOs and political organisations
- Persons under debt review and unrehabilitated insolvents
- Primary agriculture such as backyard gardens
- Speculative property developers.
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Nothemba Qina, also of the department, said applicants stood a better chance of getting the loans if they have a clear operational plan, market, financial analysis, comply with all requirements of the criteria and demonstrate they will have an impact on poverty, job creation and economic development.
“Membership of the local chamber of commerce will be an advantage which keeps one updated on workshops and other support to help grow the business,” she said.
Details; 011 440 7887; 011 440 8103; info@galxcoc.com
