Trialogue research found that approximately 5% of CSI spend in 2024 went towards entrepreneur and small business support (down from 8% in 2023). The Department of Small Business Development (DSBD) received R2.4 billion for 2024/25, constituting 0,1% of consolidated government expenditure for the financial year.
According to the 2025 State of the Nation Address, South Africa’s Small, medium and microenterprises (SMMEs) number between 2.4 and 3.5 million, injecting over R900 million into the economy and employing around 13.4 million people. High levels of unemployment,
particularly among young people, have led the government and many other agencies to prioritise support for SMMEs in South Africa.
The following policy papers and research provide some insight into the policy framework surrounding small businesses and entrepreneurship in South Africa.
Relevant acts and policies for enterprise development
- National Integrated Small Enterprise Development (NISED) Strategic Framework (Masterplan). The Department of Small Business Development’s NISED represents a national Small Business Support Strategy as prescribed by the National Small Enterprise Act 1996 (amended) to advance the development of a thriving small business sector that contributes meaningfully to inclusive growth and job creation.
- SMMEs and Co-operatives Funding Policy for South Africa. Despite the significant role that SMMEs play in sustaining the South African economy, they still struggle to access financial business support. Cabinet approved the final government funding policy in September 2024.
- National Small Business Amendment Act 29 of 2004. The Department of Trade and Industry classifies enterprise size according to annual turnover, in terms of this Act, which amends the National Small Business Act of 1996. Small businesses encompass a number enterprises, from formally registered to informal and non-VAT registered organisations.
South African research in enterprise development
- Evaluation of access to finance, market and viability of small and medium-sized enterprises in South Africa
This 2021 paper evaluates access to finance, market access and viability of SMEs.
- The Dynamics of Youth Employment and Empowerment in Agriculture and Rural Development in South Africa: A Scoping Review. South Africa has made significant investments aimed at transforming the agricultural sector to deliver on rural economic development and job creation, but with varying levels of success. Youth unemployment remains at a global high. This report aims to identify the challenges youth face in accessing sustainable employment in the agriculture sector.
- Taking responsibility for entrepreneurship development in South Africa: The role of local municipalities. This 2020 research article argues that local municipalities should play a key role in developing and uplifting entrepreneurs in their areas of jurisdiction, with lessons drawn from both developing and developed nations.
- The SA SMME Covid-19 Impact Report. South Africa lost a decade’s worth of jobs in less than half a year of lockdown and the economy slowed by 16.4% in the second quarter of 2020, compared with the first quarter. This November 2020 report indicates that 42.7% of small businesses closed due to the Covid-19 pandemic and lockdown.
- Small Enterprise Development Agency’s 2024/25 Annual Performance Plan. In its annual performance plan, SEDA noted its intention to concentrate on interventions aligned with the 2020-2025 Strategic Plan and the MTSF 2019-2024 objectives. Significant resources were allocated to enhancing growth and sustainability of township and rural-based SMMEs and Cooperatives, with Seda establishing 79 service access points throughout the country, mainly in township and rural areas.
- Sustainable Livelihoods of Township Small, Medium and Micro Enterprises towards Growth and Development. This 2020 paper discussed ICT adoption by township SMMEs to help them to become more sustainable.
- The impact of financial support on the success of small, medium and micro enterprises in the Eastern Cape province. This 2018 research paper, which analysed 350 active SMMEs registered in the formal sector and conducting business activities in the Eastern Cape, contends that the public and private sectors lack an understanding of the needs of SMMEs, and recommends that programmes developed for SMMEs must be demand-driven to avoid a mismatch between SMME expectations and support provided.
International research in enterprise development
- A global think tank is helping policy makers tackle the impact of Covid-19 on SMEs. Accurate data on the impact of Covid-19 on SMEs globally is essential to help governments and international organisations take appropriate action. The Global SME Policy Network, a group of researchers, business and policy experts, is working together to assist policymakers, and intends publishing a series of whiter papers on the impact of Covid-19 on SMEs.
- Masters of disasters? Challenges and opportunities for SMEs in times of crisis. This 2020 paper suggests ways in which SMEs can overcome economic downturns during a crisis.
