The Ultimate Guide To Funding For Women’s Business In South Africa

The Ultimate Guide To Funding For Women’s Business In South Africa

Reading Time: 4 minutes

Introduction To Funding For Women’s Business

According to SME South Africa, 47% of South African small business owners are women. That’s a 6% increase in the female to male entrepreneur ratio. We know that SMEs are a major driver of job creation, so on paper, the future certainly looks bright.

That’s until you factor in that 70% of new businesses fail within the first 18 months. It’s clear that access to funding for women’s business remains a big challenge.


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According to one survey, 88% of small businesses are self-funded, have never applied for funding and don’t actually know where to apply for funding. Plus, most claim access to finance is their number one challenge.

So what can be done to support female business owners in South Africa? The answer seems remarkably simple. Funding. More specifically, it’s access to the right information that empowers female business owners to make informed financial decisions.

We’ve put together this handy guide to help you understand how funding can be used to help your business grow.

Challenges Affecting Female SMEs

There is nothing more satisfying than running your own business. But being your own boss does come with its own challenges.

The main business challenges faced by SMEs are:

  • Access to finance and credit
  • Cash flow management
  • Marketing
  • Red-tape
  • Access to support
  • High startup failure rate
  • Access to markets
  • Skills shortage

Business funding exists to help deal with some of these challenges. As an entrepreneur and business owner, you need to understand the unique challenges that face your business and determine what kind of business funding can help you overcome them.

Clearing The Fog Around Business Finance

Financial literacy and easy access to information about business funding is key to solving many of the challenges facing your business. You need to know how to plan, budget, invest and have a working understanding of the financial health of your business.

It’s also important to know that applying for business finance is not an indication that your business is struggling. Most, if not all, businesses that have been operating for some time need capital in order to scale.

Funding For Women’s Business In South Africa

In the past, SMEs had to rely on banks to provide a range of financial services, but because of restrictions and tough requirements, actually walking away with the funding needed was difficult. Now there is a range of alternative lending options for SMEs, each with their own pros and cons.

Some forms of finance like bootstrapping, angel investors, venture capitalists, crowdfunding and accelerator programs are only applicable to new businesses and startups.

For existing businesses, funding options include secured and unsecured loans, bank finance and government grants. Funding intended for a specific purpose, such as a bridging loan or purchasing equipment, carry their own minimum requirements.

Alternative lenders have proven a popular and more flexible option for South African SMEs looking for easy access to finance.

Business Credit

Business credit can be a great tool for growing your business and it’s a lot more flexible than a small business loan.

A business credit facility works in the same way as a credit card, which can be a huge advantage for SMEs. It’s always there when you need it, which is great for peace of mind, and means you don’t have to withdraw from your personal funds when you need quick access to working capital.

And the biggest advantage – you only need to apply once.

Using Your Funding

There is a common misconception that only new businesses require funding. The reality is that business funding can be applied for at any stage in a business’s lifespan and can be used to meet many different needs.

Examples of ways you can use your business funding include:

  • Expansion of your premises
  • Hiring additional staff
  • Equipment purchase
  • Marketing
  • Buying Inventory
  • Managing Cash Flow

What you do with your business funding is ultimately up to you. As a business owner, it’s your job to ensure you know exactly what you need funding for and how to use it to achieve your business objectives, whether it’s growth, purchasing seasonal inventory or buying the equipment needed to scale.

Understanding Debt

As a business owner, you need to understand how your money can work for you. This includes your business debt.

It’s important to understand that there is a difference between good debt and bad debt.

Bad debt does not influence your business growth. In fact, it does the opposite. Drawing on your credit card to cover day-to-day-expenses, luxury items or depreciating assets like a vehicle, counts as bad debt.

Good debt works for your business. Business funding that contributes to the growth of your business or ultimately increases your net worth can be considered good debt.

The Secret To Growing A Successful Business

Accessing finance to grow your business is a big step in the right direction, capitalising on that investment is another smart move. But running a successful business is so much more than maintaining liquidity. It’s about why you decided to do it in the first place.

Research shows that 74% of entrepreneurs start their own businesses because they want to pursue their passion and make a positive impact in South Africa.

We’ve handpicked some inside secrets from successful female SMEs to help you along the path to success:

  • Tell your brand story in your marketing – it will make customers (and investors) love what you do
  • Define your values and let them drive your business activities
  • Connect and engage with your customers and they will return for more
  • Get tech-savvy and embrace technology
  • Be a disruptor and show the world what makes you different
  • Network as much as possible and share your success story
  • Never sell yourself short – be proud of what you have achieved
  • Pay it forward and mentor other women business owners like yourself

Grow Your Business With Lulalend

Lulalend is dedicated to helping South African businesses grow and that includes providing access to funding for women’s business.

According to our own market research, 59% of SMEs say access to credit is their biggest business challenge. With Lulalend, you can access up to R1 million in business funding or business credit in as little as 24 hours. Simply apply online and complete our paperless, obligation-free application and we’ll be in touch with your answer.

If you have any questions, get in touch with us today and we’ll help you find the business funding solution that’s the right fit for your business.

Visit to apply.

See how we helped Mondisa Goduka, CEO and founder of Kids Cooking Club Cape Town, with access to finance to grow her business.

Celebrating world MSME Day #MSMEDay19

Celebrating world MSME Day #MSMEDay19

Reading Time: 3 minutes

For the last 3 years there has been a greater recognition of Micro, small and medium size businesses around the globe. The United Nations has declared the 27th of June as a day to publicly drive awareness of their contribution to sustainable development worldwide. The annual celebration, known as World MSME Day, is now a regular occurrence across several countries and continents.

Why the recognition of small to medium size businesses?

On a number of fronts SMEs need significant support. Raising awareness for them globally is an initiative to help highlight their contributions as well as their greatest needs. By increasing awareness of their specific challenges we can begin to address them and help drive further business growth and sustainability.

According to researchers it is estimated that in South Africa, SMEs make up 91% of formalised businesses, providing employment to 60% of the labour force and contributing to roughly 34% of the GDP.  These businesses are what drive and foster technology and innovation, positively impact the communities around them through job creation and provide the platform for local growth. 

The greatest challenges facing South African SMEs:

Research into SMEs in South Africa regularly highlights the most significant obstacles to growth businesses of all kinds face are:

  • Securing finance
  • Upskilling and training employees
  • Tax regulations and requirements 

These on-going barriers hinder SMEs from reaching their true potential.  Leaving them vulnerable and susceptible to stunted growth despite them being one of the biggest contributors to job creation and economic development.

What can be done to help our SMEs?

Expanding the options SMEs have to secure funding is essential. 

The primary challenge for SMEs remains access to finance, and this has a ripple effect on other business needs. Access to working capital allows for the other challenges to be met and addressed over time. 

But without this initial access growth can grind to a halt when:

  • equipment can’t be purchased
  • new hires can’t be made
  • businesses can’t promote their products and services
  • inventory can’t be purchased to continue making sales

SMEs are often denied access to finance because traditional lenders see them as too high a risk. These lenders often require collateral that small business owners don’t have to put down as surety. Or the time and red tape required to apply for a loan is just too prohibitive for SMEs that need to move quickly.  

With the growth of alternative lending fintech companies, such as Lulalend, who understand and tailor their services to SME customers we will be able to open up access to business financing.

At Lulalend we cater to the needs of the SME businesses that are the driving force behind our economy. We offer access to finance that is uncomplicated and immediate. Business owners can turn to us for funding to maintain cash flow and access working capital to drive growth. 

Businesses like New Earth Recycling, owned by Noel Ehrenreich, were able to access fast, easy funding of up to R1 million through Lulalend. With this finance Noel was able to expand and grow his business through the purchase of raw materials, hiring new staff and taking on new business opportunities. Noel’s business isn’t the only one that has benefited from access to finance with Lulalend. You can find out more about other businesses we have been able to help sustain and grow on our customer testimonials page.

Because we’ve seen first hand the impact access to finance can have on the businesses we’ve supported, Lulalend is a huge supporter of World MSME Day. We celebrate this initiative along with the local businesses who are making significant contributions to our country. 

We thank them for all their endeavour, ingenuity and on-going persistence under adversity.  

The unforeseen costs of long term loans

The unforeseen costs of long term loans

Reading Time: 2 minutes

As you look for business funding you may come across various options for a term loan. Simply put a term loan is a sum of capital that is borrowed and is paid back over time with interest.  

The length of the loan term can differ depending on the financial institution you approach. The length of the loan and the interest rate can have a large impact on the total amount you pay back, so it’s important to shop around and make sure it’s right for your business needs. While lower repayments over longer term loans might seem enticing, they may cost you more in the long run so it’s worth doing a thorough comparison.

Does the term length really have such a big impact?

Doing your due diligence is important. It helps to ensure that you can afford the loan repayments , but will also provide clarity over the total cost of the loan over time. Shorter term loans might require higher monthly repayments but could save you a significant amount in interest costs when compared to a 36 or 48 month loan term. Some business lenders like Lulalend even allow for early settlement without any penalty fees – offering you another opportunity to save money.

Below is a basic example of how the term of the loan can impact the repayments and total cost, and what you need to be mindful of.

The differences between short term vs. long term loans

What questions are important to ask?

Here are some important questions you should be asking yourself when looking for business funding:

  1. What are the interest rates? This will affect your monthly repayments and the total amount repaid
  2. What kind of flexibility is there with repayments – is it a monthly repayment or can it be split into bi-weekly payments?
  3. What type of financing is it – there are various types of financing and they each come with their own advantages and disadvantages?
  4. Are there additional fees?ost financial institutes will ask for admin fees, late payment fees or early settlement fees that are added extras.

Find out how short term business funding with Lulalend can give you quick, immediate access to funding that is paid back over 6 – 12 months.Our higher approval rates, versus traditional lenders, for SME’s improve your chances of accessing funding that will not require you to provide high value collateral. With no hidden or early settlement fees you will also be able to reduce the overall cost of the loan compared to other lenders.

Election finished. How do we now move forward with confidence?

Election finished. How do we now move forward with confidence?

Reading Time: 2 minutes

The 2019 election results are in! They may have left you encouraged or disheartened, but as a nation we now need to look forward to the future together and hold the government to their promises of bringing about the economic growth and stability we need.

Most economists agree the 2019 election outcome will have significant impact on our long term economic prospects as South Africa continues to walk a tightrope around it’s credit rating status. In the short term though, Senior Economist at the Bureau for Economic Research at the University of Stellenbosch, Hugo Pienaar, believes things are looking up for our economy. Financial institutions are becoming more willing to extend credit and we are seeing a greater focus on building the confidence of foreign investors.

As we settle into the reality of the 2019 election results it’s also important for South Africans to try and build their own confidence in the economy to increase our chances of achieving increased growth and prosperity for all. Much of this confidence can come from the growth and stability of our SME’s, and the fostering of a strong entrepreneurial spirit. Our country is made up of more than just a ruling party. It is made up of millions of individuals that are innovators, forward thinkers and inclusionists, seeking to be the solution and not the problem.

At Lulalend we believe that offering fast and easy access to funding for smaller businesses is a critical factor in helping SMEs maximise their contribution to our economic growth. And according to a recent article in the Business Report, we are not alone. Here are the most common initiatives businesses believe would help instil confidence in the economy and what the elected government should focus on:

Support for the development of small businesses

While there has been some recent progress on this front through the introduction of the Department of Small Business Development 5 years ago, it is widely believed there is still much more to be done in developing  support structures that include financial support, mentorship and access to markets.

Skills development

People want to see tertiary education providing a platform for the development of future skills that can meet the demands of the job market.

Tax incentives and prompt invoice payments

One of the biggest struggles for business owners is cash flow. There is a continued desire for the government to offer small business tax relief that is tangible, as well as more stringent policies and accountability around the 30-day payment rule.


Across the board there is a hope that transformation will positively infiltrate all corners of South Africa. This can only come from an inclusive mindset that allows, and provides for, opportunities of fairer education, skills development, entrepreneurship and job creation for all.

Being part of the solution isn’t easy. It is a tireless and continued effort to help everyone move forward. But, it is brave and admirable and what we need above all else.

How are you going to be part of the solution in 2019 and beyond?