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Can small businesses apply for debt relief during the lockdown?

Answer: 

Yes - the South African government offers a range of 'safety nets' to support SA's small and medium businesses (SMEs) during the nationwide lockdown.

One of which is the Debt Relief Finance Scheme, here's how it works -

Small and medium businesses that have been negatively affected, either directly or indirectly, by the COVID-19 pandemic qualify for assistance if they meet the following criteria -

  • The business must have been registered with the Companies and Intellectual Property Commission (CIPC) before the 28th of February 2020.
  • The business must be 100% owned by South African citizens
  • 70% of the business’s employees must be South African
  • Be registered and compliant with SARS and UIF.

Note that:

  • Businesses owned by women, young business owners and people with disabilities will be given priority.
  • Seda will assist micro-enterprises to comply and request for assistance must be emailed to [email protected] whereas small and medium enterprises must ensure own compliance.

To Apply - 

  1. Register here - https://smmesa.gov.za/,
  2. Complete the online application form, and
  3. Upload the following supporting documents:
    • Proof that the business is negatively affected by COVID-19.
    • The business’ constitutional documents.
    • Fica documents (e.g. Municipal accounts, a letter from traditional authority).
    • Certified id copies of directors.
    • Bank statements (3 months)
    • Annual financial statements or latest management accounts not older than three months from date of application – where applicable.
    • The business profile.
    • 6 months of cash flow projections – where applicable.
    • A copy of the lease agreement or proof ownership if applying for rental relief.
    • The facility statements of other funders.
    • A detailed breakdown on the application of funds including salaries, rent etc

Who will benefit from the scheme?

  • Businesses with a turnover of less than R50 million will be allowed to delay their PAYE tax payments over the next four months, and their provisional corporate income tax payments over the next six months, without penalties.
  • The Department of Small Business Development has allocated R500 million to assist SMEs whose operations are affected by COVID-19.
  • The Industrial Development Corporation has allocated R3 billion in funding for firms who produce essential goods to scale up their operations.
  • The South Africa Future Trust has been set up to provide a further R1 billion in zero-interest loan funding to SMEs in distress.
  • All major banks have announced options for payment holidays and debt restructuring for SMEs and individuals who cannot meet their obligations

 

For more information:

Email: [email protected] or [email protected]

Call: 0860 663 7867

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