coronavirus smme relief

coronavirus covid 19 - small to medium enterprise debt relief scheme and the south africa future trust

If you are a small to medium enterprise and have suffered negatively as a result of the Coronavirus pandemic, you may be eligible to apply for relief.

The SMME Debt Relief Finance Scheme and The South African Future Trust have been created to assist SMMEs with their difficulties.

small to medium enterprise debt relief scheme

If you are a small to medium businesses which has been negatively affected by the Coronvirus Lock Down, you may be elligible for the SMME Debt Relief Scheme.

To assist businesses during the Coronavirus Lock Down difficult time, the Department of Small Business Development has launched a debt relief fund to help mitigate the impact of the economic shutdown caused by the coronavirus on small, micro and medium enterprises (SMMEs).

It will provide soft-loan funding for a period of 6 months, from 1 April 2020.

It is aimed at providing relief on existing debts and payments, and to assist entities to acquire raw material, and to pay labour and operational costs. All these interventions will be structured to match the patterns of the SMME’s cash flows, as well as the extent of the impact experienced due to the COVID-19 pandemic.

SMMEs that were registered with the Companies and Intellectual Property Commission (CIPC) by 28 February 2020 can apply for relief, if the business is 100% owned by South African citizens and at least 70% of their employees are South African citizens. The business must also be registered and compliant with SARS and UIF.

Qualifying criteria

  • The business must have been registered with CIPC by at least 28 February 2020;
  • Company must be 100% owned by South African Citizens;
  • Employees must be 70% South Africans;
  • Priority will be given to businesses owned by Women, Youth and People with Disabilities;
  • Be registered and compliant with SARS and UIF;
  • Seda will assist micro-enterprises to comply and request for assistance must be emailed to debtrelief@seda.org.za;
  • Whereas small and medium enterprises must ensure own compliance;
  • Registration on the National SMME Database – https://smmesa.gov.za
  • Proof that the business is negatively aected by COVID-19 pandemic;
  • Complete the simplied online application platform;
  • Company Statutory Documents;
  • FICA documents (e.g. Municipal accounts, letter from traditional authority);
  • Certified ID Copies of Directors;
  • 3 months Bank Statements;
  • Latest Annual Financial Statements or Latest Management Accounts not older than three months from date of application – where applicable;
  • Business Profile;
  • 6 months Cash Flow Projections – where applicable;
  • Copy of Lease Agreement or Proof ownership if applying for rental relief;
  • If applying for payroll relief, details of employees – as registered with UIF and including banking details – will be required as payroll payments will be made directly to employees;
  • SMME employers who are not compliant with UIF must register before applying for relief;
  • Facility Statements of Other Funders;
  • Detail breakdown on application of funds including salaries, rent etc.

Application process

the south african future trust

What is it?

The SAFT is an independent trust set up by Nicky and Jonathan Oppenheimer to extend direct financial support to the employees of South African Small, Medium, and Micro-sized Enterprises (SMMEs) who are at risk of losing their jobs or will suffer a loss of income because of COVID-19.

SAFT’s immediate purpose is to extend financial assistance to employees of SMMEs who are at risk of losing their jobs or will suffer a loss of income because of COVID-19.

SAFT will transfer funds directly to employees of participating SMMEs, via interest-free loans where employees themselves carry no liability.

The SAFT loans will be interest-free for a five-year period and subordinated to other pre-existing debt. If businesses are unable to repay the loan, SAFT will work closely with SMMEs to ensure that sustainable repayment plans are in place.

The interest-free loan is repayable in full, on or before 31 December 2025. Instalment payments can be made over the course of the 5 years, as determined by the SMME, or as a lump-sum payment on or before 31 December 2025. There will be no penalties for early repayments.

Who is eligible?

SMMEs with an annual turnover of below R25 million who have been trading for at least 24 months and who were viable businesses on 29 February 2020, and have been adversely affected by the COVID-19 pandemic.

Application process

SMMEs should register their interest directly with their bank. Currently this scheme is limited to clients of ABSA, FirstRand Bank, Nedbank, and Standard Bank.

SMMEs must provide the following to their bank, to apply for the scheme:

  • Entity identification (a registration number for a company or a close corporation, a Master’s reference number for a trust, or an ID number and business address for a sole proprietor);
  • A valid PAYE number registered with SARS (if applicable);
  • A valid income tax number registered with SARS; and
  • Confirmation of permanent employment status of employee.

contact us if you have any questions or require assistance

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