Desperate times call for desperate lending. Two months after the much-vaunted loan guarantee scheme was launched, the mechanism designed to assist small businesses to remain intact during the lockdown has fulfilled just a sliver of what was intended to be the backstop of the president’s economic relief package.

The reasons vary for why the take-up has been so slow: only R10.5bn has been approved thus far with the commercial banks on the hook for the first 6% of any losses. To be redeemed for any further losses, the banks must prove to the SA Reserve Bank and the Treasury that the loan was extended with the same care and prudence and using the same criteria, as any other loan...

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