Latest news with #R500m
IOL News
a day ago
- Business
- IOL News
Postbank asks Parliament to push for R1. 7bn funding
Postbank has only been separated from the Post Office operations and systems which are legacy systems not for banking. Image: Supplied Postbank CEO Nikki Mbengashe on Wednesday revealed the urgent need for R1.7 billion to maintain capital adequacy, following a challenging 18 months in which the bank has already expended more than R500 million of its own revenue to sustain operations. Mbengashe underscored the bank's necessity for R600m for direct operations, with the remainder serving as a guarantee in alignment with the South African Reserve Bank's (Sarb) regulatory requirements. "With the money we have made, we have spent more than R500m in the last 18 months to two years. We've been able to establish a new call centre, we've got visibility, we are partnering with retailers, we have built in new systems," she said. "We need a little bit more to build on that. The R1.7bn fulfills the sub-regulatory requirements to ensure that we keep that amount to qualify for capital adequacy." 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Next Stay Close ✕ Discussing the broader role of Postbank, Mbengashe highlighted the continued exclusion within South Africa's banking system, with more than 7 million individuals still unbanked. Mbengashe noted the importance of upgrading legacy systems inherited from Post Office operations to ensure compliance and enhance banking capabilities. "We must not underestimate the impact of having a State bank and commercial banks. It's never one or the other, mandates are different. If we can collaborate on the closed Post Office infrastructure, absolutely we can. We are still to an extent using the Post Offices, but they do need to upgrade because we are regulated and need to be compliant, and therefore, there needs to certain compliance matters," she said. "Postbank has only been separated from the Post Office operations and systems which are legacy systems not for banking. We are on a journey to build proper banking systems. We have already invested R500m. That is why we are here asking for more money so that we can digitise and get better at what we are doing." Addressing the issue of housing loans, Mbengashe pointed out a critical gap in the current system—while banks may offer home loans, they often do not meet all applicants' needs. "Banks can currently give you a home loan but they never qualify or close the 100% gap. What do we do with the people who only qualify but still need a certain amount? The house they are targeting needs to close a gap of the 10% or 20%, someone needs to close that 20% gap, we absolutely agreed that should be serviced by the Postbank," she said. "The Postbank has the service, the capability, the compliance and the auditability to do that. That's why we recognised that Sassa should come to us. A customer has an option in terms of where you bank. Therefore, we are not mandating and forcing anyone. We offer something that differentiates us from the private sector." Postbank Administrator, Khaya Ngema, expressed strong optimism about the bank's potential impact on economic growth and inclusion, saying it was fundamentally viable with serious growth potential and with smart investments. "A successful Postbank is bursting to make an impact on economic growth and inclusion as it will unlock the currently poorly-served micro-businesses and unlock communities and sectors that are marginalised," Ngema said. "A successful Postbank will have a good impact on government delivery systems, particularly in supporting modernisation and efficiency of government payment systems. This is not taking from commercial banks." BUSINESS REPORT
The Citizen
02-07-2025
- Business
- The Citizen
Major funding lifeline for township traders
Local spaza shop owners are urged to apply for the R500m Spaza Shop Support Fund, a national initiative aimed at strengthening township convenience stores by providing funding, training, and business development support. This is according to Mogale City Local Municipality (MCLM) communications officer, Refilwe Mahlangu. She said a recent information session was held at Centenary Hall, where the city's Local Economic Development Section and the West Rand District Municipality partnered with the Department of Small Business Development, the Department of Trade, Industry and Competition, the Small Enterprise Development Finance Agency (SEFA), and the National Empowerment Fund (NEF) to educate entrepreneurs on how to access the Spaza Shop Support Fund. Key stakeholders who attended the session included Executive Mayor Lucky Sele, representatives from the South African Revenue Services (SARS), West Rand District Municipality representative Sivuyile Boyce and Gauteng Department of Economic Development Head Mpho Nawa. 'Launched by President Cyril Ramaphosa in November last year as part of the government's response to the foodborne illness crisis, the fund supports spaza shops through financial assistance and training, with a strong emphasis on food safety, business sustainability and market competitiveness,' said Mahlangu. She added that the support available will include: • Stock purchases via approved partners • Infrastructure upgrades (eg, fridges, shelves, security) • Operational tools and systems • Training: Point of Sale device use, business management, digital skills, food safety, and more However, Mahlangu emphasised that people who qualify for this fund are South African citizens operating spaza shops in townships or rural areas. 'Shops must be registered with the local municipality. For funding above R80 000, registration with the Companies and Intellectual Property Commission and SARS is required. Shops must meet compliance standards and be owner-managed. Up to R100 000 in support is available for qualifying businesses,' Mahlangu continued. The details for more information and applications on this fund are below: • Contact 011 305 8080 • Visit the website • In person: At your local municipality, NEF or SEFA office At Caxton, we employ humans to generate daily fresh news, not AI intervention. Happy reading!
IOL News
03-06-2025
- Business
- IOL News
Spaza shop fund under fire: Questions over R500m initiative
The R500m Fund, launched to bolster South African-owned spaza shops in townships and rural areas with stock, infrastructure upgrades, and training, has come under intense scrutiny. Image: Itumeleng English/Independent Newspapers A VIRTUAL briefing by the Department of Small Business Development (DSBD) on the progress of the R500 million Spaza Shop Support Fund descended into chaos last week, with MPs from across the political spectrum lambasting officials for 'lacklustre' responses, unresolved corruption risks, and a controversial 'middlemen' supply model that critics warned could hijack the initiative. The Fund, launched to bolster South African-owned spaza shops in townships and rural areas with stock, infrastructure upgrades, and training, was under intense scrutiny. Only 3 000 to 5 000 applications have been received — a fraction of the estimated 200 000 spaza shops nationwide — raising concerns about exclusion, bureaucratic hurdles, and whether foreign-owned shops were being sidelined. The most explosive revelations centred around the Fund's reliance on three unnamed Delivery Channel Partners (DCPs), private wholesalers tasked with supplying spaza shops. Opposition MPs accused the state of creating a 'monopoly' for connected insiders. 'Why are these DCPs not listed in the presentation? Who are they? What are their markups? This is a middlemen scheme!' charged the DA's Nico Pienaar, demanding the Gazette records detailing their selection. FF+'s Henk van den Berg echoed concerns: 'Do spaza shops have to buy from these DCPs? Who pays them, the Fund or the shop owners?' DSBD Deputy Director-General Qinisile Delwa sidestepped specifics, stating only that DCPs were 'vital intermediaries'. Lwandiso Makupula from the Small Enterprise Development and Finance Agency (Sefda) later admitted that 58% of spaza shops are Somali-owned and 25% Ethiopian-owned, leaving just 8% eligible for the Fund. But MPs were unmoved. 'This is a recipe for fronting. Cartels will use locals as fronts to access funds,' warned the ANC's Peter Mabilo. Pienaar slammed the Fund's 'reckless' exemption of spaza shops from immediate Companies and Intellectual Property Commission (CIPC) and tax registration, calling it a 'free pass for abuse'. 'We're bleeding taxpayers, yet here's a state fund allowing six months' grace before registration. This is anti-formalisation and anti-growth,' he said. DSBD offered no justification, deepening suspicions of lax oversight. With Gauteng dominating applications, rural provinces risk being left behind. 'Your roadshows are failing. Rural spaza shops are lifelines, why aren't they prioritised?' asked chairperson Sonja Boshoff (DA). The ANC's Moses Modise blasted the DSBD's 'pathetic' outreach: 'Where are the community radio ads? The local newspaper campaigns?' Municipal licensing emerged as another crisis point. Many townships lacked digital systems, leaving spaza shops in limbo. 'Some municipalities don't even have licensing capacity. Is DSBD engaging the South African Local Government Association (Salga)?' Boshoff pressed. Delwa conceded that only the Northern Cape was piloting e-licensing, while KwaZulu-Natal and the Western Cape lead. Despite Makupula's assurance that 'misused grants convert to loans', MPs remained sceptical. 'Where are the anti-corruption measures? Who monitors officials?' Boshoff asked. The MK Party's Sarah Mokoena highlighted registration chaos: 'The online system crashes constantly. Shop owners think they're registered when they're not.'
IOL News
27-05-2025
- Business
- IOL News
Lessons from Microsoft: what Starlink can learn about entering the South African market
Elon Musk has previously claimed Starlink was barred from operating in South Africa because he is not Black, an allegation South African officials refuted. Image: AFP 'In 2011 as MD of Microsoft SA I signed one of the first Equity Equivalent deals in the ICT sector worth about R500m. The Equity Equivalent deal paved the way for more than R25 billion Microsoft has invested in SA under the leadership of Lillian Barnard. The R25 billion direct investment by Microsoft was about building of cloud data centres in SA in the process creating youth employment and buying material from local businesses. It was never about dishing that money to individuals.' wrote Mteto Nyathi on the 25 May 2025 on X. There's a lot to learn from what Nyathi has shared on this matter in view of current debate about Starlink. The first lesson is that it is incorrect to suggest that it was impossible for Starlink to enter South Africa without handing over shares to a black business person. The post by Nyathi reminds us that a number of US tech companies entered the South African market without being required to do something impossible and unreasonable. South African technology history tells us that Microsoft has been involved in a number of skills development initiatives that were aimed at empowering black people with technology skills. Those technology skills development initiatives were done partly to address a challenge faced by young black people in the technology sector. Video Player is loading. Play Video Play Unmute Current Time 0:00 / Duration -:- Loaded : 0% Stream Type LIVE Seek to live, currently behind live LIVE Remaining Time - 0:00 This is a modal window. Beginning of dialog window. Escape will cancel and close the window. Text Color White Black Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Background Color Black White Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Transparent Window Color Black White Red Green Blue Yellow Magenta Cyan Transparency Transparent Semi-Transparent Opaque Font Size 50% 75% 100% 125% 150% 175% 200% 300% 400% Text Edge Style None Raised Depressed Uniform Dropshadow Font Family Proportional Sans-Serif Monospace Sans-Serif Proportional Serif Monospace Serif Casual Script Small Caps Reset restore all settings to the default values Done Close Modal Dialog End of dialog window. Advertisement Next Stay Close ✕ We do not get the sense that there was any pain felt by Microsoft in the process of empowering young people. Instead, Microsoft has benefited in the sense that Microsoft products have been adopted across the board in South Africa. The second lesson from Nyathi's post is that few years down the line Microsoft has invested a significant amount of money in infrastructure that will benefit both South Africa and Microsoft in the form of data centres that will be developed in the country with the R25 billion investment. The lesson here is that it was possible to get investment based on the current version of the law designed to empower local people and economy. The R25 billion investment did not require any change in law. It's also important to note that Microsoft is not the only US tech company that observed local laws and still benefited in the process. Now, with those lessons in mind one has to ask, why was it necessary for current law to be tweaked. Was it not possible for Starlink to follow the same model followed by Microsoft and other US technology companies? In my view, the debate about what has been preventing Starlink from operating in South Africa is neither here nor there. It's not clear to me why there was a need to tweak the law to enable Starlink when the regulatory environment was already enabling. At the same time one can't say the majority of South Africans will not benefit from an existence of Starlink, now that policy provisions that were designed to enable them are no longer in place. We know that perhaps local businesses may not get the necessary skill to maintain or support Starlink in the long run. This partly creates a risk that South Africa will forever be dependent on Starlink to have such a technology. The process behind empowerment also entailed developing local capacity which is crucial in enabling continuity. Elon Musk needs to appreciate that there's something positive about developing others. The fact that such a technology will enable connectivity in rural areas is something worth celebrating. More technologies such as Starlink should be enabled in South Africa. The Amazon Project Kuiper should be enabled aswell as the Chinese version, SpaceSail (also known as Qianfan). This moment however raises a need to reflect as follows, where is Sentech? Is it not Sentech's role to provide what will ultimately be enabled by Starlink and others? Wesley Diphoko is a Technology Analyst and the Editor-In-Chief of FastCompany (SA). BUSINESS REPORT Visit:
The Citizen
21-05-2025
- Business
- The Citizen
Spaza shops ask for more than R32m worth of stock
According to the presentation, spaza shop owners applied for a combined total of R32.4 million for machinery and stock. Spaza shop owners across the country have submitted applications requesting more than R25 million worth of machinery and stock from the government, as part of efforts to revitalise the informal retail sector. This comes after the launch of the R500 million Spaza Shop Support Fund by the Department of Small Business Development. In a recent briefing, it was revealed that the Department of Small Business Development (DSBD) received more than 3 269 applications from spaza shop owners seeking support through the Spaza Shop Support Fund. However, only 387 of these applications have been processed so far. Most applications came from KwaZulu-Natal, with 142 submissions and the least from North West with eight. ALSO READ: Government's R500m spaza shop support fund gets thumbs up Funding requests According to the presentation, spaza shop owners applied for a combined total of R32.4 million for machinery and stock. Of this, machinery accounts for more than R16.4 million, while stock requests make up R16 million. 'The fund seeks to enhance food safety, improve competitiveness, and strengthen locally-owned spaza shops,' the department said. ALSO READ: Illegal spaza shops 'still proliferate' despite warnings R52 million disbursed to partners To ensure efficient delivery, three Distribution Channel Partners (DCPs) have been contracted and are working across various provinces. According to the department, R52 million has already been disbursed to two of these partners to begin processing and distribution. 'The approach also provides bulk buying (wholesale network) opportunities that will propel the spaza shops to exploit economies of scale and enjoy competitive pricing and packaging,' it said. Furthermore, geo-mapping and registrations of spaza shops have commenced, with 1 411 shops verified. 'Awareness workshops will be conducted in all provinces between 23 May and 1 July 2025, covering one district per province,' it said. Online applications can be accessed on the Spaza Shop Fund website. NOW READ: Government offers R500m spaza shop support fund – Here's what you need to know
