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National Treasury and the Black Business Council are exploring ways in which government's R200 billion loan guarantee scheme can be expanded to allow the non-bank funders of small, medium and micro enterprises to qualify.
President Cyril Ramaphosa announced the scheme in April as a measure to soften the blow of the coronavirus pandemic and the national lockdown on banks as well as their individual and business clients. It is operated with the assistance of the country's major banks.
This will prevent SMMEs that may not necessarily meet the criteria for funding by banks, from being excluded from Covid-19 relief programmes.
National Treasury announced on Thursday evening that it will meet with the BBC and the Banking Association South Africa (BASA) to further discuss proposals on implementation mechanisms, including possibly expanding the scheme to include new bank clients.
This comes after a recent meeting between BBC president Sandile Zungu and a delegation of Treasury led by Deputy Minister of Finance David Masondo. The aim was to look at ways to make the loan guarantee scheme more inclusive.
Dondo Mogajane, director-general of National Treasury, said in a statement that it was appreciated when stakeholders such as the BBC raised concerns.
"With constant engagements, we are confident that we can always find common ground," said Mogajane.
In the same statement, Bonolo Ramokhele, treasurer-general of the BBC, said the BBC advocates for the acceleration of the participation of black business in the mainstream economy.
"As such, any attempt to perpetuate the exclusion of the majority will be opposed," said Ramokhele.
It was initially announced that the loan guarantee scheme is intended to assist businesses with an annual turnover of less than R300 million to meet operational expenses. The South African Reserve Bank's loans to commercial banks will be guaranteed by National Treasury.
The funds borrowed through the scheme could be used to cover the operational expenses of banks, pay salaries, and cover rent and lease agreements.
