Johannesburg, South Africa – 09 December 2024 – Finfind, South Africa’s leading online access-to-finance platform for micro, small and medium businesses, is set to publish the 2024 SA SMME Access to Finance Report, the country’s most comprehensive study of its kind. The report is anticipated to provide groundbreaking insights into the SMME funding landscape.
Finfind’s Inaugural SA SMME Access to Finance report, that was sponsored by The SA SME Fund, was published in July 2018. It has become a cornerstone resource for business development service providers, financiers and policymakers seeking to address South Africa’s funding gap.
The Finfind SMME data sample used in the inaugural study was analysed by an independent research company and was compared with credible SMME datasets for the 2017 study period – these included the formal compliant SMMEs in the SARS data set, the Quarterly Labour Force Survey (QLFS) and Stats SA data samples used in the Bureau of Economic Research (BER) Report and the GEM South Africa data sample for the same period.
Finfind’s SMME data sample was independently deemed to be a credible, representative sample of the SMME population in the country and as such, the study findings can be generalised for the formal SMME sector in South Africa.
The much anticipated 2024 edition builds on this legacy with analysis of the latest SMME dataset and an expanded national funder base, offering a critical analysis of the funding landscape for small businesses. The report’s lead sponsor is African Bank with other sponsors and partners including the SAB Foundation, Experian and the Department of Small Business Development, with independent data analysis conducted by Stellenbosch University’s Bureau for Economic Research and a peer review by the International Finance Corporation (IFC).
Finfind’s CEO, Darlene Menzies, has garnered local and international recognition for her in-depth understanding of the SMME landscape says, “Small businesses are the backbone of South Africa’s economy, yet they face significant barriers in accessing finance – one of the most critical factors for their growth and survival. We know that the key challenge for lenders is the lack of business credit data in the country and the knock-on effect this has on banks and DFI’s on appropriate credit assessments and scoring. Funding readiness is the major challenge for the business themselves.
“This report aims to provide data-backed insights on the SMMEs seeking funding to inform financial product development, policymaking, and the allocation of resources to address the challenges in this sector,” says Menzies.
Key Highlights of the 2024 Report
Latest SMME Data Set:
- The report is based on a nationally representative, clean data sample of 10,000 SMMEs that applied for funding between 1 September 2023 and 31 August 2024.
Growth in the Funding Ecosystem:
- Since the inaugural report, the number of active SMME funders in the country has more than doubled, from 148 funders with 315 finance products, to 328 active funders with 605 finance products (including grant, equity and debt).
Updated Analysis of the state of SMME Funding Readiness and Business Credit Data and insights regarding the current Credit Gap:
- The report will provide updated insights into South Africa’s SME credit gap building on the findings of the 2018 report, as well as the SMME funding supply and demand mismatch.
Global and Local Collaboration and Backing:
- The 2024 report reflects a collaborative approach with sponsors and partners such as the Department of Small Business Development, Stellenbosch University’s Bureau for Economic Research, the IFC and big industry players such as African Bank, Experian and the SAB Foundation.
Free and Accessible to All
SMME data in South Africa is scarce, making reports like the SA SMME Access to Finance Report invaluable for informing policy decisions and the development of appropriate financial products and services, including funding readiness programmes.
Finfind is committed to ensuring that this vital sector’s information is accessible to all. The report will be available free of charge to ensure that stakeholders across the ecosystem – including micro, small and medium business owners to business development service providers, funders and policymakers – have access to the critical insights needed to drive growth and sustainability.
“By making this report freely available, we aim to empower all stakeholders with the knowledge needed to address the challenges of accessing finance and to build a thriving SMME sector that can support South Africa’s economic growth,” adds Menzies.
Why It Matters
The inability to access finance remains a leading cause of micro, small and medium business failure in South Africa, underscoring the importance of addressing the growing SMME credit gap. While there are many studies highlighting SMME challenges in general, few focus exclusively on funding. This report addresses this reporting gap, offering evidence-based insights and actionable recommendations.
The findings will be released at the end of the first quarter of 2024 and are expected to provide a comprehensive understanding of the current funding landscape.
About Finfind
Finfind is SA’s leading access to finance solution for SMMEs – an online platform linking SMME finance seekers with matching funders, providing easy access to more than 350 lenders and 600 funding options. Go to www.finfind.co.za to find the business finance you need; it’s free and easy to use.
