Positive SME Financing Outlook For 2014

Small and medium enterprises fared well in 2013, says Sisa Ntshona, head of enterprise development at Absa. According to him they are key players in the growth of the South African economy.Ntshona acknowledges though, that up to now there has not been much effort from the public and private sectors in developing an SME friendly culture.”However during 2013 there was a significant break from this trend,” explains Ntshona, adding that SME funding improved and looks set to increase threefold in 2014.

During 2013 Absa established nine walk-in entrepreneurship centres and reserved R250 million towards SME development.

Ntshona says that these developments have been a positive move for Absa in terms of reinforcing the importance of enterprise development and funding for SMEs. “We still need to do more by creating SME supplier development programmes and this year will be shaped by how we move beyond creating and developing these enterprises into generating a healthy and sustainable environment in which SMEs can flourish.’’

But it is not just about having access to funds says Ntshona, it is also about SMEs having access to markets and developing the skills necessary needed to enter existing and new markets.

‘’Capacitating SMEs with vital knowledge such as legal and general business acumen, remain the greatest challenges in 2014, along with policy and legislative developments that could great stumbling blocks for small business.’’

Ntshona explains that the tax review committee appointed by Finance Minister Pravin Gordhan last year will have widespread consequences for the country’s taxing system, Depending on the outcomes of the review, he says the results could either strengthen or suppress growth for SMEs.

He also states that the revised BBBEE code will start to impact SMEs during the year and adds that if properly implemented, they should contribute to meaningful supplier development.

 

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