Latest news with #SpazaShopSupportFund
IOL News
29-07-2025
- Business
- IOL News
Spaza shop owners voice frustration over 'unrealistic' government support fund requirements
Local spaza shop owners have complained over the tough and challenging application process to access government's recently established R500 million Spaza Shop Support Fund (SSSF). Image: Kamogelo Moichela/IOL Despite reported low numbers of applications, local spaza shop owners are crying foul and finding the going is getting tough with the alleged "unrealistic" requirements imposed by the government on the recently established R500 million Spaza Shop Support Fund (SSSF). In April, the Minister of Small Business Stella Ndabeni Abrahams announced the support fund during a press briefing in Soweto, which called on eligible South African spaza shop owners in townships and rural areas who want to improve, expand, and sustain their shops to apply for assistance with the R500 million Spaza Shop Support Fund (SSSF). Some of the requirements for businesses include registration with the local municipality under the relevant by-laws and business licensing requirements. This is coupled with the optional registration with the Companies and Intellectual Property Commission (CIPC) for funding above R80,000 where registration with CIPC will be required within 6 months. However, some spaza shop owners have lamented some of these requirements as exclusionary and cumbersome, with one spaza shop owner from Sebokeng, Cico Mokoena. "I am one of the spaza shop owners facing tough compliance requirements imposed by the government." Video Player is loading. Play Video Play Unmute Current Time 0:00 / Duration -:- Loaded : 0% Stream Type LIVE Seek to live, currently behind live LIVE Remaining Time - 0:00 This is a modal window. Beginning of dialog window. Escape will cancel and close the window. Text Color White Black Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Background Color Black White Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Transparent Window Color Black White Red Green Blue Yellow Magenta Cyan Transparency Transparent Semi-Transparent Opaque Font Size 50% 75% 100% 125% 150% 175% 200% 300% 400% Text Edge Style None Raised Depressed Uniform Dropshadow Font Family Proportional Sans-Serif Monospace Sans-Serif Proportional Serif Monospace Serif Casual Script Small Caps Reset restore all settings to the default values Done Close Modal Dialog End of dialog window. Advertisement Next Stay Close ✕ Jannie Morotolo, a Soweto-based architect, has shared Mokoena's sentiments, saying after trying to help local spaza shop owners with their papers, he has found the process too complicated for most local business owners. "Having been one of those trying to assist many spaza shop owners with compliance. The biggest deadlock is finance. Not a single one of the spaza shops can afford approximately R5k to get all the necessary compliance, let alone, most of them don't even have registration documents, and most of them operate in rented spaces. One of the requirements dictates that they must acquire a letter of consent from the City of Joburg, which costs about R1,100," she said. In a statement, the leader of the African Transformation Movement (ATM) in Parliament, Vuyo Zungula, following his meeting with the leaders of the South African Spaza and Tuckshop Association (SASTA) over the R500 million fund and recent presentation of the Tobacco Products and Electronic Delivery Systems Control Bill. "We have met with SASTA to discuss the unrealistic requirements to access the R500 million Spaza Shop Support Fund and the Tobacco Bill that seeks to criminalise informal traders on making a living. We have committed to working closely with SASTA to ensure that their concerns are considered when Parliament finalises the Bill. The ATM will address a letter to deputy president, Paul Mashatile, to raise concerns about the failure of the Department of Health to consult spaza shops in finalising the SEIAS report on the Bill," stated Zungula. However, reacting to the outcry, Benji Seitlhamo, acting director for Economic Development Facilitation Department in City of Johannesburg, denied the accusations, saying the processes have been made easy despite a low application rate due to failure by local business owners to comply with the requirements. "It is not true that the process is complicated. The process is easy, but is being made difficult due to the failure by owners who are not compliant. The city enforcing its bylaws and owners going back to being compliant would seem or be regarded as complex and frustrating. If they had been compliant previously, this would not be the requirements are easy if you have a draft plan from the architecture. We prefer this as it is easy to get compliant. Once this is done, you take this plan to the city's department of development planning for them to approve the plan," he stated. On the number of approved spazashop owners, Seithlamo indicated that the numbers have been low due to the high level of failure to comply with the requirements to access funding. He revealed that the city has been conducting various workshops and engagements with spaza shop communities across the nine regions of the city. "The Department of Small Business and Development and its agencies have given themselves 100 days to return to shop owners who register for funding. Obviously, because the sector is illegal, the numbers are low. It is only 30 percent of the R500 million fund that has been distributed nationally, and that figure is even lower for the city of Johannesburg, as we have just over 100 applications so far. That is why there is no closing date for applications to access the fund," he stated.
IOL News
27-07-2025
- Business
- IOL News
Count Me in Movement calls for reform of spaza shop regulations to support local businesses
The Count Me In Movement has decried the systemic exclusion of South African citizens and township business owners from accessing crucial government support as the nation grapples with a burgeoning informal retail sector. . Image: Independent Newspapers Archives The Count Me in Movement has taken a firm stand against the "systematic exclusion" of South Africans within the current Spaza Shop regulatory framework, calling in the process for a significant overhaul of South Africa's spaza shop regulatory system. The movement said the current system excludes township business owners from accessing crucial government support while the nation continues to grapple with a burgeoning informal retail sector. This comes after the recent government announcement of the R500 million Spaza Shop Support Fund (SSSF), which seeks to empower eligible South African spaza shop owners in both townships and rural areas, offering them a lifeline to improve, expand, and sustain their businesses. However, the Count Me in Movement argues that many local entrepreneurs remain locked out of this initiative, primarily due to excessive compliance burdens, fragmented registration processes, and pervasive barriers within the licensing system. Video Player is loading. Play Video Play Unmute Current Time 0:00 / Duration -:- Loaded : 0% Stream Type LIVE Seek to live, currently behind live LIVE Remaining Time - 0:00 This is a modal window. Beginning of dialog window. Escape will cancel and close the window. Text Color White Black Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Background Color Black White Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Transparent Window Color Black White Red Green Blue Yellow Magenta Cyan Transparency Transparent Semi-Transparent Opaque Font Size 50% 75% 100% 125% 150% 175% 200% 300% 400% Text Edge Style None Raised Depressed Uniform Dropshadow Font Family Proportional Sans-Serif Monospace Sans-Serif Proportional Serif Monospace Serif Casual Script Small Caps Reset restore all settings to the default values Done Close Modal Dialog End of dialog window. Advertisement Next Stay Close ✕ In a statement released on Friday, the movement appealed directly to Small Business Minister Stella Ndabeni-Abrahams, urging her to address these pressing challenges. They disclosed that while spaza shops play a pivotal role in township economies, a lack of streamlined and accessible compliance requirements often deters local operators from benefiting from government initiatives. "Despite playing a critical role in township economies, many of these businesses remain locked out of the Spaza Shop Support fund due to excessive compliance. burdens, fragmented registration requirements, and systematic barriers in the licensing process," it said. The movement said unregistered spaza shop owners, most of whom are undocumented foreigners have made the process very difficult for local spaza shop operators. "Adding to the challenge is the rapid proliferation of unregistered spaza shops, operated by undocumented foreign nationals, who are not subjected to the same inspections or regulatory scrutiny--creating an uneven and unfair playing field for local entrepreneurs. "Our local entrepreneurs are being set up to fail by a system that expects full compliance with scattered, expensive and inaccessible requirements. The current model disproportionately impacts South African spaza shop owners who lack the digital access, financial resources, or administrative support required to navigate complex state systems," the movement added.
Daily Maverick
25-07-2025
- Business
- Daily Maverick
Majority of spaza shops fail to meet R500m support fund's criteria
The organisation representing spaza shop owners says that the low compliance rate can be blamed on outdated and rigid compliance criteria. Nearly four months after the launch of the Spaza Shop Support Fund, only 14% of aspirant entrepreneurs have met the fund's compliance requirements. The fund was launched by the minister of trade, industry and competition, Parks Tau, and the minister of small business development, Stella Ndabeni-Abrahams, in Soweto on 10 April. The Department of Small Business Development has stated that despite the spaza shop sector playing a vital role in township economies, it still faces significant challenges, including intense competition from large retailers with greater buying power, limited access to working capital and inadequate business development support. The launch of the fund attracted just over 10,000 applications, which are currently under review for funding. The applications have been split into two categories, with the first group made up of the 14% who comply with the requirements. The Department of Small Business Development said these applications were being finalised for funding. The second group of applications comprises the 86% who do not yet meet the compliance requirements for various reasons, including not providing documentation such as business licences or trading permits. 'Failure of government' The spokesperson for the South African Spaza Shops Association, Kgothatso Ramautswa, said it was deeply concerning that only 14% of applications met the fund's compliance requirements. 'It reflects not a failure by the spaza shop owners, but rather a failure of government to design and communicate a realistic and accessible funding support system,' said Ramautswa. 'Most spaza shops operate in the informal economy, and the current compliance framework is not tailored to the lived realities of township entrepreneurs.' Ramautswa said the 86% figure showed that the fund was failing its intended beneficiaries. If 86% of applicants were non-compliant, the problem lay in the system, not the people. He said it was unacceptable that such a large portion of the informal economy was non-compliant with the fund's requirements because of outdated and rigid compliance criteria. The department has said that instead of declining the non-compliant applicants, it was providing non-financial support, including assistance in applying for the necessary documentation through their local municipality. Outreach programme Siphe Macanda, the spokesperson for the Department of Small Business Development, said: 'This support is part of a broader outreach programme, which serves as an extension of the non-financial support available under the fund. The countrywide outreach programme is implemented by officials from the Department of Small Business.' However, Ramautswa insisted, 'The requirements are overly technical, bureaucratic, and not reflective of township business operations. The average spaza shop does not have access to accountants, registered business documents, or internet connectivity.' The Spaza Shop Support Programme provides targeted financial and non-financial support, with funding of up to R100,000 per qualifying spaza shop owner. The department said this support package is designed to promote sustainability, competitiveness and regulatory compliance. It includes: Up to R40,000 for stock purchases, facilitated through approved delivery partners to ensure reliable and cost-effective supply. Up to R10,000 for business training, covering key modules such as point-of-sale systems, basic business and financial management, digital literacy and credit management, and food safety and regulatory compliance. Up to R50,000 for infrastructure upgrades, including improvements to shop buildings, refrigeration and shelving, security systems, and other essential business assets. 'This comprehensive package aims to strengthen the operational efficiency of local spaza shops, improve their competitiveness and foster inclusive economic participation within township communities,' said Macanda. The department said that despite no applications being formally declined, as part of the due diligence process, applications may be declined in future under specific circumstances, including the following: The applicant is not a South African citizen, as the fund is intended to support South African-owned spaza shops; Fronting — where the applicant is misrepresenting ownership or control of the business; Fraudulent documentation or misrepresentation in the application; An invalid or non-existent trading permit or a business licence that cannot be resolved through the support process; and/or Use of funding for personal or non-business-related purposes, which goes against the objectives of the fund. 'It is important to emphasise that the fund does not immediately decline applications that are non-compliant. Instead, these applicants are provided with client-specific non-financial support to assist them in complying with the fund requirements,' said Macanda. Job Creation The department said the R500-million fund fully covers the cost of training as part of its comprehensive support package. An amount of R10,000 per beneficiary is allocated for targeted business training and capacity building. This amount is included within the broader R100,000 funding package per qualifying spaza shop owner. The training component is designed to develop critical business management skills. To qualify for the Spaza Shop Support Fund, spaza shops must operate within South Africa's townships or rural areas and must serve the local communities in those regions. 'This focus is aligned with government efforts to revitalise township and rural economies by promoting local entrepreneurship, job creation and access to essential goods and services,' said Macanda. 'Spaza shops located in more affluent or urban areas are not eligible under this specific fund, as it is designed to support historically underserved and economically marginalised communities. 'However, spaza shops or retail outlets in urban areas may still qualify for support through existing funding programmes offered by the NEF [National Empowerment Fund] and Sedfa [Small Enterprise Development and Finance Agency]. These programmes cater to a broader range of businesses outside the scope of the Spaza Shop Support Fund,' she said. Corruption Daily Maverick asked the department how it ensured that the fund was used effectively, transparently and free of corrupt elements. The department said it had a comprehensive set of oversight and governance mechanisms in place. 'All applications are processed through an automated system, allowing for real-time tracking and daily reporting on approvals and disbursements. Funding is only disbursed following formal approval by the Investment Committee, which rigorously evaluates applications in line with the fund's due diligence protocols and eligibility criteria,' said Macanda. 'To safeguard the integrity of the disbursement process, the Finance Division applies strict internal controls to verify and validate each transaction prior to payment. 'Post-disbursement, the NEF's Post-Investment Unit conducts audits and site visits to confirm that funds are being used in line with approved business plans. Importantly, disbursements are made directly to vetted and pre-approved suppliers, rather than to beneficiaries, reducing the risk of fund misuse.' Macanda said governance was further strengthened through regular oversight and coordination. 'These combined mechanisms ensure that the fund operates with a high degree of transparency, accountability and alignment with its developmental objectives,' added Macanda. The current maximum funding available per spaza shop owner is R100,000, and this support is offered as a blended finance instrument, with a 50% grant and a 50% interest-free loan. The debt portion is repayable, but carries zero interest. The South African Spaza Shops Association was critical of the non-financial support, asserting that business owners chiefly require finances. 'While training and support are welcomed, they should not replace the urgent financial assistance that these businesses most require to survive. Spaza shops are struggling with load shedding, high crime, inflation and dwindling foot traffic. 'Training without financial backing is a Band-Aid over a gaping wound. Non-financial support should be integrated with immediate access to funding in a practical manner,' said Ramautswa.
The Citizen
02-07-2025
- Business
- The Citizen
Major funding lifeline for township traders
Local spaza shop owners are urged to apply for the R500m Spaza Shop Support Fund, a national initiative aimed at strengthening township convenience stores by providing funding, training, and business development support. This is according to Mogale City Local Municipality (MCLM) communications officer, Refilwe Mahlangu. She said a recent information session was held at Centenary Hall, where the city's Local Economic Development Section and the West Rand District Municipality partnered with the Department of Small Business Development, the Department of Trade, Industry and Competition, the Small Enterprise Development Finance Agency (SEFA), and the National Empowerment Fund (NEF) to educate entrepreneurs on how to access the Spaza Shop Support Fund. Key stakeholders who attended the session included Executive Mayor Lucky Sele, representatives from the South African Revenue Services (SARS), West Rand District Municipality representative Sivuyile Boyce and Gauteng Department of Economic Development Head Mpho Nawa. 'Launched by President Cyril Ramaphosa in November last year as part of the government's response to the foodborne illness crisis, the fund supports spaza shops through financial assistance and training, with a strong emphasis on food safety, business sustainability and market competitiveness,' said Mahlangu. She added that the support available will include: • Stock purchases via approved partners • Infrastructure upgrades (eg, fridges, shelves, security) • Operational tools and systems • Training: Point of Sale device use, business management, digital skills, food safety, and more However, Mahlangu emphasised that people who qualify for this fund are South African citizens operating spaza shops in townships or rural areas. 'Shops must be registered with the local municipality. For funding above R80 000, registration with the Companies and Intellectual Property Commission and SARS is required. Shops must meet compliance standards and be owner-managed. Up to R100 000 in support is available for qualifying businesses,' Mahlangu continued. The details for more information and applications on this fund are below: • Contact 011 305 8080 • Visit the website • In person: At your local municipality, NEF or SEFA office At Caxton, we employ humans to generate daily fresh news, not AI intervention. Happy reading!
The Citizen
24-06-2025
- Business
- The Citizen
Spaza Shop Campaign benefits local business owners
Government's Spaza Shop Support Awareness Campaign is providing much-needed clarity while also encouraging business owners to do things by the book. 'Before today, I didn't know where to start or which documents were truly necessary. This workshop answered questions I've had for years. Now, I understand what compliance actually means and how to meet those expectations,' spaza shop owner Matshidiso Mooki said. Mooki was among those who attended the session held at the City Hall in the Vereeniging Central Business District in Gauteng on Friday. She said the campaign brought clarity. 'I am determined to ensure that I comply with all the regulations so that I can qualify for support through the Spaza Shop Support Fund,' she said of the session. The campaign offered spaza shop owners and township-based convenience store operators critical information on how to apply for both financial and non-financial support under the R500-million fund that was launched by Trade, Industry and Competition Minister Parks Tau and Small Business Development Minister Stella Ndabeni Abrahams in April. For Matome Tshabalala, the information received at the session was a game changer. He started his shop after the COVID-19 lockdown. 'I've always operated informally, but now I want to do things the right way. What stood out for me was the emphasis on record-keeping and understanding zoning laws. I also appreciated the introduction to stock management and bookkeeping,' he said. The campaign, which aims to formalise and support township-based enterprises, brought together local spaza shop owners, government officials and business development stakeholders. Compliance Participants at the session heard about the importance of compliance requirements for spaza shop permit applications. Matshepo Madumbo, the Assistant Manager of Local Economic Development and Tourism at Emfuleni Local Municipality, emphasised the importance of adhering to municipal regulations when applying for permits. 'Many residential areas are not zoned for commercial activity. For a spaza shop to operate legally, the property owner must apply for a rezoning certificate. Without that, the business cannot be recognised as compliant. 'I cannot stress the importance of submitting a stamped building plan, an occupancy certificate, certified identity document, a proof of address no older than three months, and registration documents from the Companies and Intellectual Property Commission (CIPC) along with a valid tax clearance certificate,' she said. Madumbo noted that failure to comply with these requirements often leads to unnecessary delays and missed opportunities for funding and supplier networks. 'The Spaza Shop Support Campaign continues to rollout across provinces, ensuring that township entrepreneurs are not only included in the broader economic framework but are also equipped to thrive within it. 'By focusing on compliance, formalisation, and access to resources, the campaign is helping to level the playing field for small business owners in underserved communities,' said the Department of Trade, Industry and Competition and the Department of Small Business Development. – At Caxton, we employ humans to generate daily fresh news, not AI intervention. Happy reading!
