Small businesses are in need of financial assistance as Covid-19 brisks the economy. Image: iStock
Growthpoint Properties’ enterprise development initiative has welcomed the Department of Small Business Development’s plan to assist SMEs amid the coronavirus pandemic, but requires “detailed and decisive actions” on financial assistance.
Property Point’s request follows the announcement made by the department last week, saying that it is in the final stages of availing a Debt Relief Fund to support Small and Medium Enterprises (SMEs) to mitigate the risks during the Covid-19 State of Disaster.
The department said the Debt Relief Fund, which is aimed at providing relief for existing debts and repayments, will be launched on Tuesday (March 24).
Proper assessment needed
Property Point’s two-year enterprise development programme is an intensive programme for select SMEs.
Founder Shawn Theunissen, said that the department’s announcement of the Debt Relief Fund needed to provide detail before it could be appropriately assessed and stress-tested with the realities of the SMMEs on the ground. He added that it is nothing new.
“The fund and facility are platforms that have been around for some time. These solutions are already in the market and under these circumstances, we need something differentiated and fit for purpose….
Property Point agrees that it is imperative that small businesses are provided with financial aid during this period. They say they need urgent help at various levels, as they are experiencing cash flow constraints, due to payments delays.
Further, the outcome from discussions they held with the more-than 250 businesses across the country in its two-year programme, has led to the identification of four challenges:
They say that when the site launches on Tuesday (March,24), they expect it to provide detailed and decisive actions, easily accessible relief packages, quantification of the solutions as well as customised offerings for entrepreneurs.
Corporates come to the party
Globally, corporate companies have availed their assistance to small businesses in current trying times.
The United States has $300 billion relief package for small business; Nigeria has announced a $136 million fund to help small and medium businesses; and Indonesia has set up loans of up to $655 000 for SMEs.
In South Africa so far Standard Bank has said it will introduce a three-month payment holiday for small businesses with a turnover of less than R20 million, as well as for full-time students with student loans.
Nedbank has availed its support for clients with individual solutions to cashflow challenges as a result of Covid-19; this extends to any loan agreements with Nedbank in good standing.
Vodacom on Monday introduced VodaLend, a small business funding product that lets business owners apply online for funding and have an answer within four hours.
But more financial assistance is requested.
“We also would like to see banks and financial institutions responding [more] accordingly so that as a result, most small businesses that need credit during these uncertain times will be able to obtain it,” said Theunissen.
On Monday there were 402 identified Covid-19 cases, skyrocketing since Sunday.
President Cyril Ramaphosa placed the country on a 21-day lockdown on Monday evening.
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