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South African Government launch “Debt Relief Fund” to help small business during Coronavirus pandemic

South African Government launch “Debt Relief Fund” to help small business during Coronavirus pandemic

The Debt Relief Fund is aimed at providing relief on existing debts and repayments, to assist SMMEs during the period of the COVID-19 State of Disaster.

South Africa (22 March 2020) – After the President declared a state of national disaster in response to the COVID-19 pandemic, the Department of Small Business Development has been inundated with enquiries from SMMEs about the measures to mitigate the severity of the impact on their businesses.

“As a department, we are part of the government’s response to address the impending impact on the economy, in general, but specifically we had to ready ourselves, together with our agencies, to effectively respond to the needs of SMMEs in affected sectors. The government understands that SMMEs will be affected on two levels as businesses when the economy slows down and as suppliers of products and services during this period. To mitigate the impact during the expected economic slowdown, the department is finalising the SMME Support Intervention comprising of Debt Relief Fund and Business Growth/ Resilience Facility. We have requested the MECs responsible for Economic Development in all provinces to support the department to ensure the widest reach of SMME support.”

The Debt Relief Fund is aimed at providing relief on existing debts and repayments, to assist SMMEs during the period of the COVID-19 State of Disaster. For SMMEs to be eligible for assistance under the Debt Relief Fund, the applicant must demonstrate a direct link of the impact or potential impact of COVID-19 on the business operations. This facility will also assist entities in acquiring raw material, paying labour and other operational costs. All these interventions will be structured to match the patterns of the SMMEs cash flows, as well as the extent of the impact suffered.

To strengthen monitoring and avoid abuse, SMMEs requiring assistance will be required to enrol on the SMME South Africa platform (www.smmesa.gov.za) which will go live on Tuesday, 24 March 2020.

The department’s insistence on the use of the SMMESA database is based on the need to track, monitor and strengthen the impact of business development support to SMMEs by both government and the private sector, during this period and beyond.

In future, the database will also be used to apply for both financial and non-financial support, access information about business opportunities and market access support.

Visit smmesa.gov.za to register.

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