Johnathan Paoli
President Cyril Ramaphosa has signed into law, the National Small Enterprise Amendment bill, ushering in more adequate government support for small and medium businesses and broadening South African participation in the economy.
Presidential spokesperson, Vincent Magwenya announced on Tuesday the assent of the President to the bill which amends the National Small Enterprise act of 1996.
Magwenya said the bill seeks to incorporate the Small Enterprise Finance Agency (SEFA), the Small Enterprise Development Agency (SEDA), and the Cooperative Banks Development Agency (CBDA) into a new entity the Small Enterprise Development Finance Agency (SEDFA).
“The new Small Enterprise Development Finance Agency will function as a one-stop-shop for aspiring entrepreneurs and promote the development of the Co-operative Banking Institutions (CBIs),” he said.
The spokesperson said the legislation established the Office of the Small Enterprise Ombud Service, which in addition to dealing with complaints, has the authority to recommend to the Small Business Development minister the declaration of certain practices as prohibited unfair trading.
He said the bill authorises the minister to make regulations setting the criteria to determine the classification of small, micro and medium enterprises (SMMEs) as well as any legislation affecting small businesses.
This forms part of the presidency’s declaration in the State of the Nation Address at the beginning of the year, in which Ramaphosa declared the government’s intention to providing business infrastructure support, financial assistance through loans and blended funding, facilitating routes to markets, and assisting with technical skills, product certification, testing and quality assurance.
Small Business minister Stella Ndabeni-Abrahams outlined the re-introduction of the bill last year and said the mischief the bill aims to remedy is the lack of effective and affordable access to a justice system for small enterprises.
“Business-to-business disputes and late or non-payment of amounts due and payable to small enterprises are a significant reality in the lives of small enterprises across the world, with very adverse implications on their growth,” she said.
According to government statistics, there are currently between 2.4 and 3.5 million SMMEs in the country, injecting over R900 million into the economy.
Government says that over R900 million in loans have been granted to over 20 000 small businesses in support, culminating in the creation of over 30 000 jobs.
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