SPAZA SHOPS R500MILLION FUNDING @KASIBCNEWS

ACKNOWLEDGEMENTS 

The Director General of the Department of Small Business Development, Ms Thulisile Manzini. MECs serving in the Economic Cluster from our provinces (Names of MECs attending). Senior Government officials and  Members of the Media present today and those joining us on digital platforms Fellow South Africans,  

Background  Today marks exactly 107 days since President Cyril Matamela Ramaphosa announced the registration of all Spaza Shops and Food handling outlets.  

The announcement came after several incidents of food poisoning and deaths related to foodborne illnesses were reported in different parts of the country. The initial 21 days registration period, which would have ended in December last year, was subsequently extended by the President to 28 February as part of accommodating all eligible businesses to comply with the directive. 

The final deadline for registration of the businesses was on Friday. the 28th of February, and today we have convened this Press Briefing to update the nation on the progress of business registration and interventions adopted by the Department as part of assisting small businesses and curbing further foodborne illnesses. 

It is important to clarify that reaching the deadline for the registration period, does not necessarily mean that the problems and challenges of compliance by Spaza Shops and food handling outlests are over nor does it mean that the sector is now fully regulated to adhere to the laws and regulations of the country.   

The aim of the registration drive was twofold: to ensure compliance with all food safety standards and to rebuild a more competitive and compliant business in our country.  The registration of Spaza Shops is but one of the interventions in a multi-disciplinary approach to curbing foodborne illnesses.  

After the announcement by the President, through the NATJOINTS, 7 workstreams were established with the DSBD leading the economic workstream which will focus more on interventions to build capacity in our township and rural spaza shops and food convenience stores.  

We have supported the registration process which the Minister of COGTA will speak to in the NATJOINT briefing in 2- weeks- time.  Key from our side was to form a Nerve Centre with MECS from all provinces, so that we could closely monitor the registration process across the country. 

We also visited 135 Registration Centres during the process to get first-hand experience of the challenges. Provincial Teams were led by the DSBD and SEDFA and support was received from the Provincial Departments of Economic Development and Cogta, Districts and Local Municipalities across all provinces. 

We were especially impressed by the work that MECs did within their provinces in encouraging people to register and marshal their staff to treat this programme with the urgency and intensity it deserved.  

We know the process had challenges, with many municipalities not having electronic business registration systems. All those that have applied are within their constitutional rights to do business but still await the registration outcomes we not be penalized. 

We understand the difficulties and costs associated with becoming compliant and this is why over the next 6 months we will be supporting these spaza shops who applied but are not yet compliant with non-financial support to enable their successful registration and compliance. This is the developmental approach to compliance we have adopted, offering assistance to those seeking to comply through training programs provided by our agency, the Small Enterprise Development and Finance Agency (SEDFA). We already have a spaza shop support programme that we are running including with the W&R SETA and others partners where we train Spaza Shops on inventory management and assist with essential equipment such as point-of-sale systems as well as financial support for stock. This is our proof of concept which we will improve and scale going forward. 

We also have a range of other interventions and offerings to support township and rural enterprises, including TREP, asset assist, business infrastructure support, as well as wholesale and direct lending, as well as credit guarantees we offer to banks to get them to lend to township and rural enterprises. 

We will now take this initiative to scale with the R500 million Spaza Shop support Fund (R150 million from DSBD and R350 million from DTIC) that will soon be launched to support township convenience shops, including spaza stores. The fund will be launched in the next two weeks and a date will be communicated. 

Other businesses will still benefit from existing departmental funds and programmes including financial assistance by our entity SEDFA and other DFIs. The fund aims to: Achieve Economies of Scale by linking spaza shops & food handling outlets to buying groups for bulk purchasing; Build Business Capacity through training and support to improve shop operations; Enhance Market Competitiveness to help spaza shops & food handling outlets compete with larger retailers; Rollout Nationally to impact spaza shops & food handling outlets across major townships. 

We are planning a to roll out a multi-disciplinary outreach programme. The purpose of the outreach program is to bring government services closer to the people through disseminating information on Community Convenience Shops and support offerings. We will continue to do these things with provincial and local government, and will facilitate awareness campaigns in all 52 districts and metros across the country. The awareness campaigns are scheduled to take place from 03 March 2025 to 30 March 2025. 

 The awareness campaigns will continue beyond the month of March through SEDFA, DSBD Business Regulation Officers, dtic and NEF. The awareness workshops will be facilitated by District Champions, Sedfa and Business Regulation Officers working with LED Offices in Local Municipalities. 

DSBD has recruited 61 Business Regulation Officers on 6-month contracts, each assigned to a District or Metro across the country. These officers will be responsible for conducting awareness campaigns, research, and Geo-mapping of Spaza Shops and Food Handling facilities among other functions. 

The regulatory environment needs to be streamlined, and the Department has embarked on a Red Tape Reduction Program to include practical solutions. As a key strategic intervention to support the red tape reduction efforts, the Department will ensure that municipalities are assisted with E-registration systems.  

We remain committed as government to streamline business licensing in South Africa, reduce regulatory burdens, and foster an environment conducive to entrepreneurship, innovation, and job creation. Our amended National Business  Licensing Bill, once approved and implemented, will provide clarity, consistency, and transparency in business licensing, enabling businesses to thrive and contribute to the country's economic growth and development.  

We have since developed a system that we call the DSBD Connect Platform will serve to streamline processes. It will serve as a cutting-edge platform designed to support township and rural businesses among others by offering a comprehensive database, verification of services, and strategic networking opportunities. 

Our Objective is to empower businesses by facilitating access to funding, credit lines, business support, and procurement opportunities. Municipalities and other system users will be onboarded and trained on DSBD Connect before its official launch. We extend our gratitude to all business owners who responded to the call to register and adhere to the laws of the land. 

As Departments responsible for economic development, we remain dedicated to supporting small businesses in their growth and ensuring that they play a significant role in the nation's economy.  

I Thank you. Minister of Small Business