1. 2011 AFRICA SMME CONFERENCE PROGRAM 13 OCTOBER 2011 GOLD REEF CITY HOTEL, GAUTENG “FACTORS INHIBITTING THE GROWTH OF SMEs”

2. 2 3  SMME financing institutions faced with a challenge of applications that are not ready – low literacy levels  Market is “flooded” with necessity as opposed to opportunity driven entrepreneurs – due to lack of job opportunities, amongst others  At what point do we measure the SMME financing gap – no conclusive research on the extent of the gap  South Africa relatively has a lot of SMME funding programmes – availability of capital not a key problem Where is the Problem? Background

3. Funders’ Key Requirements  Character - Jockey o Entrepreneur determines his/her destiny  Viability - Horse o Identify a niche – real opportunity  Equity o Have a some level of commitment – “skin in the game”  Collateral o Khula’s indemnity scheme and other similar interventions provide a solution

4. * Source: FinScope South Africa Small Business Survey 2010 Factors Inhibiting Small Business Growth *

5. 5  Unity amongst SMMEs (compromise lobbying and bargaining potential)  Access to information (SMMEs are not au fait of intervention available in the market – both public or private  SMME transactions don’t always find their way to the traditional Credit Bureau platforms - credit information of certain categories of SMMEs are not tracked Other Factors

6. 6 3  SMME practitioners need to develop effective and practical interventions to address each inhibiting factor  Research outcomes should be used for policy formulation and programme development - minimise the level of talk shops  There must be pressure (interest) groups to foster tangible delivery  Minimise duplicating efforts – coordinated approach  SMEs need to be channeled to the right doors (shopping mall experience – one stop shops for SMMEs) What are we Doing? Call to Action!

7. THANK YOU Don Mashele Cell: 083 679 9498 Email: donm@khula.org.zadonm@khula.org.za Website - http://www.khula.org.zahttp://www.khula.org.za