Cash Me If You Can: South African MSMEs’ Audacious Treasure Hunt

Grab your flying drone with the eye of an eagle and a robust pair of Shosholoza gumboots, because South Africa’s micro, small, and medium enterprises (MSMEs) are once again marching through the African financial jungle in search of the elusive Goose that lays legendary Kruger Rands.

Having wrapped up May with a modest 0.25% reduction in repo rates from our responsible uncle, the Reserve Bank, Governor Lesetja “Data Dependent” Kganyago, we also acknowledge the release of the Finfind South African MSME Access to Finance Report 2025, where MSME data meets the risk profile drama and access to funding proves elusive.

According to the report, over 70% of MSMEs in South Africa earning revenue below R1 million per annum are still struggling to secure formal finance. Yes, you read that right; the MSME economic genocide (Mr Trump, please check this one out, too). Despite all the glossy brochures and heartwarming "We Support Township Economy" slogans, most entrepreneurs still see no light at the end of the business loan tunnel.

The report affirms that MSMEs aren’t just part of the South African economy — they are its favourite black tax family member. They hustle hard, contribute over 40% to SA’s GDP, and employ more than 60% of the nation (yes, including your white cousin with his last-mile delivery bakkie). Despite MSMEs carrying more than one-third of the GDP, the golden egg bowl is mysteriously missing from the funding game for startups and early-stage businesses.

The report confirms that the demand for business loans is sky-high, but the supply is dololo (non-existent). Even more concerning is that inclusive startup finance packages don’t even make the top 10 list of offerings from most funders.

For many MSMEs, walking into a bank feels like auditioning for a Mr. Bones movie: you’re instantly thrown into the jungle of awkward financial rituals. One of the biggest mood-killers for MSMEs trying to secure funding from banks and Development Fund Institutions (DFI) is the Table Mountain of 38 stacks of paperwork. If anyone thinks I’m being economical with the truth, please grab your binoculars and look at page 65 of the report.

Between the endless forms — certified this, stamped that — it’s less about “access to finance” and more about “Amazing Race: Bureaucracy 3rd Edition” kind of stuff. The anti-gospel is that it has been an unblessed seven-year journey of zero regulation on MSME credit data sharing. That’s right, creditors are still playing “black mampatile” - hide-and-seek with MSME credit data.

Due to a lack of information, most MSME funders default to the good old “let’s just check the owner's personal credit score” method. If your business has no data trail, they judge you by how you pay your Woolies account. Fair? No comment.

Fintechs, on the other hand are encroaching on the MSME missing middle with sleek apps and quicker approvals, while banks and DFIs remain stuck in the slow lane of requesting audited statements that small businesses can only dream of. But hold on, before you get super excited!

While digital platforms are fast, they often have interest rates so high that they could make MSME owners faint right in front of the bean counter. This could even be a worse incident if you fall under the group of 60% MSMEs that lack collateral, and 85% of them operating without insurance. God forbid!

Sure, it’s easy to blame the banks — and yes, sometimes they do behave like the blue light brigades of finance, allowing only the “VIP businesses” through. But let’s be honest: as MSMEs owners, we also need to take a long, hard look at ourselves. Running a business without credible financial records, with no receipts, and with a “we’ll sort it out later” attitude won’t cut it. We should not be shocked when funders ghost us.

Access to finance begins with access to our own numbers. Despite the missing pieces, the report ends on a high note, not quite a drone crash, but a hopeful soft landing. It calls for dedicated startup funds that target the sectors where demand is hotter than a Durban summer. It proposes a future anchored in Public-private partnerships, with co-investment in bold ideas from early-stage businesses. And while we’re dreaming big, the focus should be on “blended finance with entrepreneurship development, combining loans with intensive training, mentoring, and support for young entrepreneurs.

Before we count the eggs before the chicks, the report recommends that most MSMEs need a crash course in Finance 101. That means improving financial literacy so MSMEs can manage their money better and implement payroll systems that don’t forget to pay staff at the end of the month.

On top of that, the report also acknowledges that many small businesses need a funding makeover — a proper funding and credit readiness check to spot the gaps before the big ask. MSMEs should avoid rocking up to a bank without proper documents, like wannabe refugees showing up at a visa office with fake documents, while expecting to fly where others long to go (US dream, of course).

MSMEs should seek solid pre-funding support that helps them prep their funding applications, round up the 38-stack paperwork, and impress the Artificial Intelligence (AI) assessor before the robot in suits invites them to sit across the table.

Sons and daughters of Africa, pay attention to the wise words of this report to avoid a real-life episode of Cash Me If You Can. If you follow this advice, you will become a brave treasure hunter, able to navigate red tape traps, decode paperwork puzzles, and survive the jungle of financial rituals. Bon Voyage, audacious folks, and be careful, don’t be caught in Macron’s flight drama!

Bongani Ntombela, Executive: Programmes at 22 On Sloane.

BUSINESS REPORT