Government finds R500 million for spaza shop funding

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Government has officially opened applications for the highly anticipated R500 million support fund aimed at increasing the participation of South African-owned spaza shops in the townships and rural areas retail trade sector.

Addressing the launch of the Spaza Shop Support Fund (SSSF), Minister of Trade, Industry and Competition, Parks Tau, said the fund will transform the spaza shop landscape by creating jobs, alleviating poverty, promoting economic inclusion and empowerment as well as stimulating local economic growth.

Grants and low-interest loans

The fund provides for funding of up to R300 000 per shop through a combination of grants and low-interest loans.

It allocates funding specifically for initial stock purchases, infrastructure improvements, business development tools, and Point of Sale (POS) system adoption.

Through the fund, shop owners will be provided with assistance in meeting hygiene and regulatory standards to ensure the provision of safe, high-quality products.

“We are committed to ensuring that every spaza shop that benefits from this fund also gains access to the necessary health and safety training and resources. This holistic approach will help create workplaces that are not only economically vibrant but also secure and sustainable for the future,” the minister said in Soweto.

He indicated that studies show that small businesses account for a significant portion of job creation in South Africa.�

“By equipping spaza shop owners with financial support, infrastructure upgrades, and essential business training, we are setting the stage for sustainable job creation. This means more opportunities for local talent and a reduction in poverty levels, as spaza shops expand their roles as community hubs.

“Every spaza shop supported by this fund is an engine for local growth. When these businesses thrive, they create ripple effects that boost surrounding sectors – be it suppliers, service providers, or local artisans.�

“This fund is a catalyst for economic dynamism, injecting energy and resources where they are most needed. It is an investment in our people, our neighbourhoods, and ultimately, the entire South African economy,” he explained.

Driving force for national transformation

The fund will be jointly administered by the National Empowerment Fund (NEF) and the Small Enterprise Development Finance Agency (SEFDA).

“We want a South Africa where economic opportunities are available to all, where the informal becomes formal, and where the entrepreneurial spirit of our townships becomes a driving force for national transformation.

“With this fund, we are taking a concrete step to formalise and empower the informal sector. By supporting spaza shops, we are enabling entrepreneurs, often women and young people, to participate fully in the economic process.

“These small businesses generate employment, drive local commerce, and channel much-needed income into communities that have long been underserved,” Tau said.

In order to access the funding, applicants need to apply to the NEF and SEDFA through the prescribed application process outlined on the relevant institution’s website.