Government spells out support for spaza shops during lockdown
Stores to benefit from an R500m fund to support small enterprises, but must meet certain conditions, including a willingness to buy locally made goods
Small-business development minister Khumbudzo Ntshavheni has outlined the proposed package to support spaza shops during SA’s coronavirus lockdown period, including assistance in network purchasing or bulk buying, seed capital and access to business support tools such as bookkeeping.
Ntshavheni’s department is spearheading the R500m in government support directed at the nation’s small businesses, the sector of the economy expected to be hardest hit by the three-week lockdown.
Spaza-shop assistance will, however, come with conditions, including that the business has the required municipal permit to trade, is registered with the SA Revenue Service and is willing to buy locally made goods from designated SA small businesses.
The department also wants spaza shops to meet required hygiene regulations during the lockdown — including having the ability to sanitise between serving customers and sanitise serving counters. The package is being finalised, along with the support for other informal sector workers, and the date for the opening of applications will be announced on Thursday.
Qualifying spaza shops had to be owner-operated and would be granted access to network purchasing or bulk-buying opportunities co-ordinated by her department with selected wholesalers, Ntshavheni said. They had to buy from a pre-approved basket of goods, including products made by SMES that the department and its agencies supported.
The scheme would also include seed capital to enable traders to buy stock as well as a credit facility to enable purchases “on a continuous basis” beyond the current crisis. But shop owners had to be willing to stock products made by South African enterprises.
“It’s time we promote our own and if this economy has to rejuvenate and self-sustain we must start to buy what is South African as part of reinvesting in this economy,” she said.
The department would help business owners register with the SA Revenue Service, the Unemployment Insurance Fund, and the Companies and Intellectual Property Commission, and assist those that do not have bank accounts to get them. Once granted funding, the businesses had to be willing to continue with the programme for at least a year and submit monthly management accounts, she said.
SA’s citizens seeking to register for support had to have SA identity documents and permit to trade. She did not categorically state whether foreign spaza shop owners could qualify.
But she said that permitting was not done on the basis of nationality. Foreign spaza shops owners had top have been admitted to SA “lawfully”, hold valid passports with relevant business visas or permits, which included the condition to work or operate a business.