The South African government is launching a ZAR20 billion ‘bounce-back’ loan scheme in a bid to help small businesses that are struggling under the impact of the pandemic.

As reported by Business Tech, the scheme will comprise two mechanisms. In the first, small business loan guarantees of ZAR15 billion will be facilitated through participating banks and development finance institutions, according to Finance Minister Enoch Godongwana, which will enable access for qualifying, non-bank small- and medium-loan providers.

‘The government will partner with loan providers by underwriting the first 20% of losses for banks and other eligible small and medium loan providers,’ he says.

The second mechanism, which will be introduced by April, involves a business equity-linked loan guarantee support mechanism, also facilitated by development finance institutions.

22 March 2022
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