Small Business Development Funding in South Africa

Updated on 20 June 2024

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As a small business owner, you need government support in the form of funding, skills development and training programmes. The Department of Small Business Development (DSBD) helps small businesses by providing support throughout their business journey. It has a key focus on programmes to advance entrepreneurship amongst women, the youth and people with disabilities.

In South Africa, the DSBD works with the Small Enterprise Development Agency (SEDA) and the Small Enterprise Finance Agency (SEFA) to support the growth of small businesses.

Let’s look at some of the programmes and funding opportunities available to small business owners.

SEDA

SEDA has multiple programmes for small businesses. The Business Talk page helps you decide whether you want to become an entrepreneur.

Under Business Start, you will find tools and techniques. This is where you will find help with financing, managing, marketing and franchising your business.

The Business Build tab contains guidelines on business skills and strengthening your business. Here you will find information on tenders, networking, and management skills amongst others. Lastly, the Business Grow tab offers advice to business owners who want to grow nationally and internationally.

The SEDA technology programme focuses on increasing accessibility to technologies and management support for small to medium-sized enterprises (SMEs). The programme also facilitates the acquisition and transfer of technology to SMEs, improves SME competitiveness and productivity, and reduces the failure of SMEs.

Two other programmes under the technology programme are SEDA Incubation, and Quality and Standards.

The Incubation offering has a three-year programme designed to improve technology commercialisation. It also aims to use the entrepreneurship of the technology community in South Africa. Anyone with a good business idea or a small business that needs help growing can apply.

The Quality and Standards initiative aims to show how important quality and standards are for making South Africa more competitive. It is also there to enhance the quality of products produced by small businesses.

Additionally, SEDA offers other programmes under its development division, including the Cooperatives and Community public and private partnership programme. This is where the CSI strategies of big businesses come into play.

SEFA

SEFA provides financial services and products to qualifying SMEs. The government entity helps SMEs access funding via direct lending platforms or products. Sefa also partners with various businesses to innovate finance products, tools and channels, and to speed up increased market participation.

SEFA provides direct lending services to SMEs. The loans range from R 50 000 to R 15 million. SEFA provides various types of loans. These include asset, finance bridging loans, revolving loans, term loans, and funding from the Tourism Equity Fund.

SEFA’s wholesale lending provides debt/equity to intermediaries, joint ventures, partnerships and other collaborations. These partnerships aim to extend the SEFA’s reach by making funding available to small businesses across the country. Loans to intermediaries are up to R 150 million and loans through intermediaries are up to R 5 million.

The organisation also has a tab for active, awarded and cancelled tenders.

Outside of SEFA and SEDA, the department also has other programmes for small businesses. The Township and Rural Entrepreneurship programme (TERP), Small Enterprise Manufacturing Support programme, Business Viability programme, and Co-Operative Development Support Programme.

The TERP schemes are available to the following entrepreneurs:

  • Small-scale bakeries and confectioneries support the programme.
  • Autobody repairers and mechanics support programme (as well as small and independent auto-spares shops and informal automotive entrepreneurs).
  • Butcheries support programme.
  • Clothing, leather and textiles support programme.
  • Personal care support programme.
  • Spaza shop support programme.
  • Tshisanyama and cooked food support programme.

The Small Enterprise Manufacturing Support Programme has the following scope:

  1. Furniture manufacturing – Furniture manufacturers, including coffin makers.
  2. Basic iron, metal and steel manufacturing – Manufacturers and suppliers of iron and steel products.
  3. Petroleum and chemical manufacturing – Manufacturers of sanitisers, disinfectants, recycling, paints, oils, hair & skin products, and related products.
  4. Food and Beverages manufacturing – Agro-processors of primary agricultural products including beverages sourced from small-scale farmers.
  5. Clothing, leather and textiles – The makers of shoes, linen, garments including pattern makers, designers, and fabric manufacturers amongst others.
  6. Electrical machinery manufacturing – Manufacturers of transformers, electric generators, electric motors, high voltage engineering, and power electronics.
  7. Green Technology/ Digital Technology – Makers of PV panels, clean coal technology, and 3D printing.

The Business Viability Programme aims to support SMEs including co-operatives to overcome financial and non-financial barriers. There are many funding options under this programme too.

Many opportunities exist for small businesses to get funding and development. Browse through the department’s offerings and pick the one you want.

Find more information on Small Business Develop Funding in South Africa or apply for financing from funders straight from our website.

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