R3.75bn in stimulus funding for looted businesses

THE Department of Trade and Industry and Competition (dtic) and the Department of Small Business Development (DSBD) have created an overarching Economic Rebuilding Package to assist businesses in KwaZulu-Natal and Gauteng that have been affected by recent looting.

The dtic and DSBD said they had set aside R3.75 billion to assist businesses. The funding has been allocated with dtic receiving R2bn, Industrial Development Corporation R1.5bn, and the remaining R250 million can be accessed by businesses through the National Empowerment Fund and Small Enterprise Finance Agency.

KZN Department of Economic Development, Tourism and Environmental Affairs (Edtea) spokesperson Bheki Mbanjwa said businesses that had been affected by the looting and unrest could access funding through government and private vehicles.

Mbanjwa said the DBSD offered grant funding (60%) and loan (40%) for eligible businesses who must be registered with the South African Revenue Service.

He said the loan repayments would begin after 12 months and payments would last for five years.

The department added that public entity the South African Special Risk Insurance Association (Sasria), would be injected with R3.9bn from the National Treasury to pay out insured companies.

Sasria claims would be capped to a maximum of R500m for assets and there was additional wrap cover for corporate clients of up to R1bn.

Nedbank had committed R6.4m to support clean-up programmes, humanitarian relief and infrastructure rebuilding.

Absa bank committed R12.5m to support recovery from the unrest. The bank would also be waiving point of sale monthly terminal rental fees for businesses that had been impacted and will assist with replacement of equipment if required.

EThekwini Municipality’s spokesperson Msawakhe Mayisela said the city had created the onestop centre to assist businesses that had been affected by looting in the city.

Mayisela said the centre formed part of the municipality’s multi-pronged strategy contained in the reviewed Economic Recovery Plan (ERP) in response to the civil unrest.

“The ERP now makes provision for special relief measures for all businesses that were affected by protests in the city. Some of the services that can be accessed at the centre are applications for the reconstruction of buildings damaged by fire and disconnection of services.”

He said the centre also provided an Economic Recovery Fund desk (collection and delivery of documents for payments to the selected businesses), an SMME help desk, help with late payments of suppliers (dispute and outstanding information), and business forums engagements. The assistance being provided includes:

Relief funding from the Small Enterprise Finance Agency and the Nedbank Informal Traders Support Programme which is R3 000 once off.

Ithala in partnership with the Edtea and the Zimela Traders Empowerment Programme is offering relief to formal and informal businesses.

The MTN-My Spaza Fund. The Industrial Development Corporation’s (IDC’s) business recovery fund will assist all businesses that operate in selected sectors.

The dtic’s Manufacturing Competitiveness Enhancement Programme Economic Stabilisation Fund will support manufacturing companies, including those impacted by associated supply chain disruptions. The fund will offer concessionary funding through interest-free loans.

The Economic Incentive Policy being offered through the eThekwini Municipality Economic Development Unit.