COVID-19 is hurting businesses, thrusting South African SMEs into an uncertain future. If you’re a business owner, it’s hard to keep track of all the information around the outbreak and how it impacts your SME.
To help you stay updated with the latest developments, we’ve pulled together SME resources from government and business support organisations.
We’ll be updating this page regularly with new resources for SMES.
Latest updates: The South African Enterprise Development Agency is running a survey to assess the impact on COVID-19 on your SMME. Jump to Government Support for South African SMMEs to learn more. Government has set up a Tourism Services Call Centre. If you’re in the tourism sector, and you’ve been affected by COVID-19, contact 0860 029 999 between 8am to 10pm, Monday to Sunday.
Jump to a specific section to learn more:
- General COVID-19 advice
- COVID-19 shutdown and South African SMEs: Impact on trading
- Government support for South African SMEs during the coronavirus outbreak
- Private sector support for SMEs
- The cost of business funding
- Will Lulalend still provide business funding during the coronavirus outbreak?
- Can I qualify for funding if my industry is affected by the coronavirus?
- What if my business is affected by the coronavirus?
- What should I do if I have more questions?
General COVID-19 advice
On 15 March, President Cyril Ramaphosa declared the COVID-19 outbreak a national state of disaster. (Full statement here.) A week later, on 23 March, the President announced a 21-day lockdown, effective from 26 March.
The President outlined a plan to respond to the outbreak. You can find the statement here.
For the latest information from the government, visit the South African Government’s website.
The National Department of Health has set up a COVID-19 resource portal.
The site includes:
- Latest press releases from the Health Ministry
- COVID-19 prevention tips
- Social distancing guidelines
In addition, the National Institute for Communicable Diseases issues regular updates on new cases here.
COVID-19 shutdown and South African SMEs: Impact on trading
Any business not classified as a provider of essential services will not operate during the shutdown.
Here’s a list of essential services:
If your SME falls into this category, you need to apply for an essential services certificate from the Companies and Intellectual Property Commission. You can apply for a certificate from CIPC’s Bizportal website here.
Government support for South African SMEs during the coronavirus outbreak
A package of support programmes will help SMEs during the shutdown, announced President Ramaphosa.
- The Temporary Relief Scheme for companies that are struggling because of COVID-19. To avoid retrenchments, employees at these companies will get paid through this scheme
- Employees who fall ill at work will be paid through the Compensation Fund
- Commercial banks to develop new programmes for debt relief
- A tax subsidy of up to R500 per month for the next four months for private sector employees earning below R6,500
- SARS will pay employment tax incentive reimbursements monthly instead of twice of year
- Over 75,000 SMEs will be able to delay a portion of their PAYE and corporate tax without penalties or interest
- The Industrial Development Corporation and the Department of Trade and Industry have put a R3bn fund together for industrial companies
- Tourism businesses can access R200m to deal with the impact of travel restrictions
The Department of Small Business Development set up an SME Support Intervention to help SME owners who are struggling to survive. The department released the news on Facebook, and you can view the full statement here.
Here is an overview of the Department of Small Business Development’s funds:
Two key funds are:
- SMME Debt Relief Scheme
- Business Growth and Resilience Facility
In a press briefing, government announced qualifying businesses must meet the following criteria:
- 100% South African-owned
- 70% of employees must be South African
The Department of Small Business is aiming for a 14-day turnaround to release funds. You can watch the full briefing here.
The department has released application guidelines and more detailed criteria, including the type of documents you need when you apply. You can find the guidelines here.
To access funding, follow these steps:
- Register on www.smmesa.gov.za
- Complete the application forms. You can download the forms from the same site: http://www.smmesa.gov.za/
- Upload the supporting documentation
- At this stage, applications must be emailed
|Funds||Supporting documents||Key contacts|
|Debt relief finance scheme||Company statutory Documents;|
FICA documents (e.g. municipal accounts)
Certified ID copies of Directors;
3 months bank statements;
Latest annual financial statements / Latest management accounts;
6 months cash flow projections (where applicable);
Copy of lease agreement or proof of ownership if applying for rental relief
Employee details (bank details and UIF) for help paying salaries
|Business Growth and Resilience Facility||CIPC registration documents;|
FICA documents (e.g. municipal accounts);
ID Copies of directors/ members;
3 months bank statements;
Latest annual financial statements /management accounts;
6 months cash flow projections (where applicable);
Industry certification (where applicable);
Estimations for funding requested
|COVID-19 TERS||Letter of authority: letter on a company letterhead giving an individual permission to lodge claim |
Agreement between the employer, bargaining council, and UIF
Template from the UIF with relevant information from employer
Last three months payroll
Certified latest bank statements
|012 337 1997 /email@example.com|
In addition, the government has published Request for Proposals to get more information from South African-owned SMEs that participate in medical supplies and other essential goods. The goal is to get more of these businesses involved in manufacturing the goods. For more information, send a mail to firstname.lastname@example.org or call the department on 0860 663 7867.
If you want more information on these support measures, you may want to read these blog posts:
- An overview of the COVID-19 government funds for SMEs
- More detail on COVID-19 tax relief for SA SMEs
Private sector support for SMEs
Business support organisations, like the South Africa Small Business Institute, have warned that the outbreak could cripple SMEs.
In response, a range of interventions to support SMEs have been announced.
The Oppenheiemer family set up the South Africa Future Trust, seeding the funds with a R1 billion pledge. Businesses can apply for interest-free loans from the fund. A key goal of this fund is support SMMEs to pay staff salaries. Businesses can apply for the loan from their banks. You will need to attach a list of employees at risk because of the coronavirus.
Other resources include:
- The National Small Business Chamber’s COVID-19 Relief centre helps businesses to create business continuity plans, digital marketing strategies, and help to develop hygiene programmes.
- Facebook announced a $100m package of cash grants and ad grants for 30,000 small businesses in 30 countries. To learn more, visit Facebook.
The cost of business funding
COVID-19 has created a challenging economic environment.
On Thursday (19 March 2020), the South African Bank announced that the Monetary Policy Committee had dropped the repo rate by 100 basis points.
Lesetja Kganyago, Governor of the South African Reserve Bank, said the coronavirus would “negatively affect global and domestic economic growth through the first half of 2020”.
“Monetary policy can ease financial conditions and improve the resilience of households and firms to the short-term economic implications of Covid-19.”
Here’s a copy of the full statement.
Will Lulalend still provide business funding during the coronavirus outbreak?
Your business matters to us. Supporting you to succeed has always been our mission. That hasn’t changed.
We’ll continue to make it easy for you to access business funding.
Because we’re a technology company, you can still apply online in minutes and get your funding in 24 hours. And, remember, if you’re on our credit facility, the process is even faster because you don’t need to reapply.
Can I qualify for funding if my industry is affected by the coronavirus?
Yes, now more than ever it is important we support SMEs across the economy. Over the past few weeks, we’ve been speaking with SMEs about the impact of the coronavirus. Some industries, like tourism, are being hit hard. But, we’re not excluding any businesses based solely on industry.
Instead, we’ll continue to use the proprietary technology we’ve built especially for assessing SME’s, combined with any risks due to coronavirus.
What if my business is affected by the coronavirus?
This is a difficult time for businesses and things are changing fast. If you realise you’re going to struggle to make your repayments, contact us as soon as possible. Together, we can find a solution.
We’re here for you and will continue to do all we can to help you.
What should I do if I have more questions?
Reach out to your account manager or contact us anytime via:
Phone: 087 943 2381 / 021 201 1550