Scheme to help qualifying businesses affected by COVID-19, July unrest and floods kicks-in

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There is good news for qualifying businesses that are recovering from the impact of the COVID-19 lockdown, the unrest in July last year and flood-related disasters.

The Bounce Back Support Scheme which the Finance Minister Enoch Godongwana had announced in the February budget has taken effect.

Government and lenders, including participating banks, are sharing the risk of the non-repayment of these loans.

The scheme comprises a loan guarantee mechanism of R15 billion, and a smaller equity linked scheme, which National Treasury and the Development Finance Institutions will facilitate.

Businesses will be required to repay the loan over a period of up to five years or a period agreed to by the lenders.

Small and medium enterprises (SMMEs) with a maximum turnover of R100 million per annum will be eligible to access the scheme.

The maximum loan amount will be set at R10 million per business and a minimum loan amount of R10 000.

Non-bank lenders can make a loan of up to R100 million, subject to the approval of the lender.

Eligible businesses should contact their banks for further information on the scheme and qualifying criteria.

CEO of the Small Business Institute, John Dludlu, explained the impact that COVID-19 has had on SMMEs: