The Department of Small Business Development says around R180 million has been approved under the R500 million Spaza Shop Support Fund
Image: Itumeleng English/Independent Newspapers
The Department of Small Business Development says around R179.6 million has been approved under the R500 million Spaza Shop Support Fund, but many shop owners are still waiting for assistance.
The fund was launched in 2025 to support South African-owned spaza shops in townships and rural areas, following government concerns about food safety, compliance, and the need to strengthen informal retail businesses.
However, concerns have also been raised about delays in the rollout, strict compliance requirements, and cases where some applications were rejected after inspections found non-existent shops or incorrect ownership details.
In a press briefing on Friday, Director-General Thulisile Manzini said the government is making progress in rolling out the fund, but that licensing backlogs and verification processes continue to slow down implementation.
"The registration process closed on 28 February 2025, with municipalities reporting approximately 82,000 Spaza Shop registered nationally. Subsequent verification confirmed 44,696 registration businesses, of which approximately 15,000 have obtained approved trading permits or licenses. It is important to distinguish that registration does not equate to licensing," she said.
"Spaza Shop owners are therefore required to secure trading permits or licenses through their respective municipalities to achieve full compliance and access funding opportunities".
She added that the government is working with municipalities to address the licensing backlog and improve the verification process, as many applications are being delayed by missing documents, compliance issues, and differences between registered owners and actual operators.
Manzini said these challenges continue to affect the pace of approvals, but stressed that due diligence is necessary to ensure that only qualifying and compliant spaza shop owners receive support.
"To date, 4,522 complete applications have been received nationally, of which 4,240 have been assessed. The assessment process continues to highlight a key structural constraint within the sector, with only 58% of applicants linked to valid business licensing or temporary permits issued by municipalities. As a result, a significant number of applications remain unable to progress until licensing and compliance requirements have been addressed".
She added that 2,369 businesses have so far been approved for support under the fund, with both implementing agencies continuing to process applications that meet all compliance and verification requirements.
"SEDFA has approved 1,316 applications, valued at $79.6 million, while the National Empowerment Fund, the NEF, has approved 1,053 enterprises, valued at R99.9 million. So, collectively, the two implementing agencies have approved support to the value of approximately R 179.6 million across all nine provinces.
"The approved support includes the stock purchases, point-of-sale devices, infrastructure upgrades, inventory support, business improvements, and non-financial and business development support, which is designed to improve sustainability and competitiveness within the township and the rural retail sector".
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