Government offers R500m spaza shop support fund – Here’s what you need to know

South African spaza shop owners looking to improve, expand or sustain their businesses can now apply for financial and technical assistance through the government’s newly launched Spaza Shop Support Fund (SSSF).

The R500 million initiative aims to bolster the township and rural retail sector.

The Department of Small Business Development officially opened applications on Monday, calling on eligible spaza shop owners to take advantage of the opportunity to access funding, training and support.

What the fund offers

The support package aims to level the playing field for small shop owners facing growing competition from large retailers.

“It provides funding, training, business skills development and technical support to help businesses compete effectively against larger retailers,” the department said.

Key benefits of the fund include:

• Offers funding of up to R300 000 per shop through a combination of grants and low-interest loans.
• Assists shop owners in meeting hygiene and regulatory standards to ensure the provision of safe, high-quality products.
• Encourage the adoption of digital payment systems, inventory management tools, and financial literacy programmes to improve operational efficiency.
• Facilitate wholesale aggregation, allowing spaza shops to access bulk purchasing advantages and competitive pricing.

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Who qualifies?

To be eligible, applicants must have the following:

• The owner of the spaza shop must be a South African citizen or naturalised as a South African citizen before 1994.
• Spaza shops must operate within South Africa in rural and township areas and serve local communities.
• The spaza shop must be registered with the local municipality in accordance with the relevant by-laws and business licensing requirements.
• Registration with the Companies and Intellectual Property Commission (CIPC) will be optional based on the enterprise’s funding requirement. For enterprises receiving funding above R80 000, registration with CIPC will be required within a period of 6 months.
• The business must have a valid registration with the South African Revenue Service (Sars) or be allowed a six-month transitional period.
• The spaza shop must comply with all other relevant legislative and registration requirements necessary for its operation (e.g. food preparation and health and safety standards).
• The owner must actively manage the spaza shop.
• Funding will prioritise entrepreneurs aged 18-35; female-owned spaza shops will receive priority consideration, and businesses owned by individuals with disabilities will be given priority.

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What you get

Support up to R100 000 includes:

• It includes a grant of up to R40 000 for the initial purchase of stock via delivery channel partners.
• Assets and infrastructure (blended grant and loan): a maximum R50 000 for the upgrading of building infrastructure, systems, refrigeration, shelving and security.
• A maximum of R100 000 for training programmes that will include point of sale devices, business skills, digital literacy, credit health, food safety and business compliance.

Support between R100 000 and R300 000:

• It includes a stock grant of a maximum of R40 000 for the initial purchase of stock via delivery channel partners.
• A maximum of R250 000 for a funding split, 50% of the funding will be provided as a grant, and 50% will be provided as a free-interest loan.
• A maximum of R100 000 for training programmes that will include point of sale devices, business skills, digital literacy, credit health, food safety and business compliance.

The National Empowerment Fund (NEF) and the Small Enterprise Development Finance Agency (SEFDA) will jointly administer the fund.

“To access the funding, applicants need to apply to the NEF and SEDFA through the prescribed application process outlined on the relevant institution’s website,” it said.

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Where to apply

Applicants are advised to create an account on the SEFDA SMME Portal, complete the registration process, accept the terms and conditions, and submit their applications online. Alternatively, applications can be submitted through the online websites:

• Spaza Shop Support Fund
• NEF
• SEDFA

For further details, contact the Spaza Shop Support Fund Call Centre on 011 305 8080 or via email.

Contact details for the NEF Call Centre are 0861 843633, SEDFA Call Centre 012 748 9600 or by email.

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