Small Business Development Minister Stella Ndabeni-Abrahams said her department and its agencies were considering interventions to support SMMEs and cooperatives affected by load shedding. Picture: ANA Archives
Cape Town - Small Business Development Minister Stella Ndabeni-Abrahams said her department and its agencies were considering interventions to support SMMEs and cooperatives affected by load shedding.
Ndabeni made the undertaking when she was responding to parliamentary questions form EFF MP Babalwa Mathulelwa, who asked whether her department has undertaken any assessment on the impact of electricity blackouts on small businesses.
Mathulelwa also wanted to know how Ndabeni-Abrahams planned to provide support to small businesses so that they continued operating.
In her written response, Ndabeni-Abrahams said her department, through the Small Enterprise Finance Agency (Sefa), conducted research study in August 2022 on the impact of load shedding on its funded clients.
The study was commissioned as a survey to 1 500 Sefa clients, but only 214 clients responded.
The SMMEs, mostly operating in manufacturing, retail trade, hotels and restaurants, construction, transport, community services, financial services, agriculture, mining and quarrying – have been in business for one to five years.
Ndabeni-Abrahams said the SMMEs that participated in the study reported loss of revenue and production due to load shedding.
She also 76% of respondents indicated that they did not have alternative power in place to mitigate the effect of load shedding.
“To cope with the impact of load shedding, most respondents indicated that they utilised the load shedding schedule to plan their business operations and have reduced their production.
“The majority indicated that they require assistance with funding to acquire alternative energy sources and assistance with restructuring of their loans, in respect of their loan repayment obligation with us,” she said.
Ndabeni-Abrahams said the department, together with the Small Enterprise Development Agency (Seda) and Sefa, was considering the introduction of interventions to address the challenges faced by the SMMEs.
One of the interventions includes what she termed as the Power Purchase Product, an immediate relief for formal and informal enterprises.
“It is an initiative of the Small Business Development portfolio to support SMMEs with alternative energy-generating equipment such as generators and photovoltaic installations.
“The programme will be implemented via the existing programme structures with informal businesses, supported via the Informal and Micro Enterprise Development Programme.
“The micro businesses will be supported through Seda’s Asset Assist Programme and the small to medium enterprises will be supported through Sefa’s Township and Rural Entrepreneurship Programme,” she said.
Ndabeni-Abrahams said there was also the Bounce Back Scheme administered by Khula Credit Guarantee on behalf of the government.
“This is a medium to long term intervention that still requires intense discussion with relevant parties, including the National Treasury who are the custodian of the scheme.
“Ongoing discussions with National Treasury indicate their interest and consideration of opening up the Bounce Back Scheme to all development finance Institutions,” she said.
Ndabeni-Abrahams added that there were ongoing consultations with various departments and relevant agencies to come up with long-term and sustainable energy supply solutions.
“The department is currently awaiting endorsement from the National Treasury before all these schemes can be implemented,” she said.
Cape Times